Posted on 04/14/2010 3:52:26 PM PDT by dynachrome
Bank of America, the nation's largest mortgage lender, ramped up its foreclosure activity in March, sending hundreds of letters warning delinquent borrowers in the region that it could sell their homes at auction in as little as three weeks, according to North County Times analysis of data from ForeclosureRadar.
The bank said the increased activity was a natural consequence of borrowers running out of options.
Analysts and real estate agents said the moves by the Charlotte, N.C., banking giant, which controls a large share of the Southern California mortgage market, could signal a final reckoning for homeowners who have been protected by government programs for months or even years
(Excerpt) Read more at nctimes.com ...
Who is gonna buy em? The Chinese?
It’s about time, those deadbeats are getting a free ride while millions who went by the rules feel like chumps for doing the right thing.
Getting the modifications doesn’t help if you still can’t afford the house. California probably had the most “liar loans”, too.
Apparently, there is demand. They didn’t foreclose before because they didn’t think they could sell them, but buyers have reappeared:
“A surge in available listings could give a lift to real estate agents, who have complained about frustrated buyers amid tight supplies of homes for sale.
“My Bank of America asset manager told me we’d really start to get hit with inventory in mid-May to June,” said Teri Garcia, a real estate agent based in Escondido who sells Bank of America foreclosures.
“If they’re sending notices of auction in March, that about fits,” she said.
“Garcia said the local supply of foreclosed homes has been low all through the winter. She was thrilled to hear that more homes might be coming onto the market this summer.
“Its about time, those deadbeats are getting a free ride while millions who went by the rules feel like chumps for doing the right thing.”
The banks?
Hmm. A good supply of Double Bubble Gum.
Probably due to the continued “unexpected” job losses.
At the bottom of the market, this is driven by cash-paying investors. They can get good rents on these houses.
I understand your frustration, as I feel the same way too sometimes, but many are people who also tried to play by the rules but were blindsided by the economy.
strategic default.
People lucky enough to still have some liquidity are going to make a bunch in the next few years.
I just purchased a lake home from a Freddy Mac foreclosure for 280K. It sold for 470K in 2007. It needs a bunch of work but all the houses around it are 600K + homes even in this market. I did not buy it as an investment but if I did it would be a good one.
I think that real-estate is a safer place to put your money right now that stocks.
Barry Soetoro is SO FINISHED!
Homes in my area are flying off the shelf to meet the April tax credit deadline. These homes are moving faster than sales during the bubble. I'd be really surprised if there was any home sale activity after this month..
I think that you are a bit harsh.
Take Southern California, to which the article refers, for example, there are a few things to consider.
1) In California, a First Trust Deed on Owner Occupied homes is a single action contract. This means the lenders only recourse action on a loan made in good faith is to foreclose the property. So the lender really made the loan on the basis of the value of the home primarily and the borrowers ability to pay secondarily.
2) I can cite a specific case. The Borrower obtained the loan in May of 2002 in the amount of $252,000. The Borrower paid diligently until May 2007. I May 2007 the borrower died. (I suppose that you might call her a dead beat).
This borrower died intestate (no last will and testament or trust) therefore the estate was put through Probate and the home was valued at $425,000.
By the time the Probate closed the value of the house had fallen to about $200,000. The new owners of the home were the borrowers two teenage children who did not have the wherewithal to pay.
The long divorced husband of the borrower and father of the children made the payments until approximately July of 2009 then decided that this was not an efficient placement of funds. He therefore attempted to acquire a modification of the loan terms and met with about as much success as arguing with an ATM.
The father then decided to play a little bit more aggressively and discontinued making payments. After much conversation and a lot of paperwork the bank agreed to a very attractive new payment schedule on the house and now all is well.
The point of this case is that had the bank not agreed to make this modification and had gone on to foreclose the house, it would have gotten considerably less than it will now and incurred very large expenses .and this foreclosure would have depressed the market further.
Apparently BoA and most other banks are holding tons of such mortgages, those that at the origination of the loan the home was worth 80% - 100% of the loan and may have appreciated in market value to 200% or more of the loan. But today a large number of these houses are worth less than 100% of the loan (no equity) and similar homes in the area are being offered at prices that are lower than what is owed on their present home.
Many are saying why not let the bank take this one and go buy another for less?.
Prices have dropped by 10% plus since this time last year when BoA sent out 31 notices of sale in the area mentioned.
Now they are sending out over 600 of theses notices imagine what will happen to the home values when this previously hidden inventory hits.
So the piper will be paid.
Either the government will inflate the currency to keep the banks afloat costing Americans wealth or the massive number of distressed sales will lower the value of homes, thus decreasing the wealth of the homeowners who have paid.
Either way it aint going to be good.
Back to your deadbeat view. I agree with your insinuation of immorality on the part of those who dont pay their unsecured debt such as credit cards.
But that home thing is different in my view the bank never said they would loan you the money for your home based on your promise to do the right thing. They loaned you money based on their assessment of the value of the house and your agreement that they can take your house if you dont pay.
By the way, the owners of the house directly across from the example case above bought their (very similar) house brand new in 1988 for $140,000 so they definitely have equity in their house at least as long as there isnt a sign across the street in front of an abandoned, unmaintained house thats says for sale by bank.
Better watch what you wish for you might get it.
In closing, all this hogwash about heaping all this debt on our kids and grandkids is just that, hogwash. The hundreds of trillions of dollars of Fed, State, County and City government promissory obligations will only by paid by the good ole standby, Hyper-Inflation.
Only when your government loses its Credit Cards will this be resolved. By rebirth and the end of free lunch.
Obozo’s home state:
Illinois bank-owned foreclosures double in first quarter
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