Financial Planner Reveals He Went Through a Short Sale

by Joe Salcedo on 7:20 am

Stumbled upon a fascinating article on NY Times: How a Financial Pro Lost his House…

“I’m a financial adviser. I get paid to help people make smart financial choices, and I speak and write about personal finance issues for this publication and others.”

He is painfully honest about his experiences (hey, he’ just like us!):

“It felt a little crazy to be shopping for houses that cost half a million dollars, but my income was growing rapidly. Everywhere I looked, people were being rewarded for buying as much house as they could possibly afford, and then some. There was this excitement in the air, almost like static. I started to think that if I didn’t buy a house right then, I would never be able to afford one.”


Real refreshing to read a financial professional being eerily honest about his experiences.  Come to think of  it, would you really trust someone to advise you who hasn’t learned for himself, albeit, the hard way? Theories and postulations can impress but don’t we learn the best when we are in the thick of the battle.  I am for the latter.

Anyways, there’s some great lessons to be learned here…instinct can play a huge role (along with, of course, hard data — you don’t have to choose one):

“At moments during our house hunt, I felt in my gut that something wasn’t right. We’d go to open houses for $400,000 homes and see lines of couples in their late 20s — younger than we were — waiting to get inside. I kept wondering where all the money was coming from. How did all these people make so much?”


Like many of us, he was not immune to “the crowd”  — something that my good friend is currently experiencing, but on the inverse — he’s about to buy a gem of a house this month, but many of his family members and even friends are deathly afraid of him taking a risk; it’s hardly a risk, I tried to explain to him, but the crowd is simply not ready to take risks.   “In financial markets, people fear when they should hope and hope when they should fear.”

“But prices just kept rising, and when people kept buying, that made it seem safer. I knew from my work as a financial adviser that following the crowd could be costly. But like everyone else, I felt safer in a crowd.”


Interesting twist in his story, he felt he lived modestly compared to his neighbors:

“Our house was the smallest model in the neighborhood (though at 3,500 square feet it was hardly tiny), and we drove a Chevy and a VW.”

Here comes the best part, the lesson every homeowner may want to take away from this informative article:

“As late as February 2006, a comparable home in our neighborhood sold for $998,000. We made the classic mistake of projecting recent trends — even extreme ones — into the future.”

Of course, the above inversely applicable for our current times.

Hope you read this amazing article:


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“I was laid off from the state in November of 2007 due to major budget cuts. We were no longer able to make our house payments as the job market was just beginning to get worse and worse. My agent in San Jose found Joe Salcedo in Reno for me and told me he has a lot of experience in short sales. He priced our home at a very realistic price in relation to the market values at the time. Joe was very professional and before we knew it we had an offer on our home. In September of 2008 our home closed and the bank forgave the difference. A short sale comes off of your credit in a much, much shorter time than a bank foreclosure. We will be forever grateful for the assistance of Joe Salcedo”

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