Drop in foreclosures called ‘very scary’

Drop in foreclosures called ‘very scary’
Lenders’ actions show they think properties are not worth pursuing.

Nobody is sure exactly how many bank walkaways are occurring. For various reasons, they can’t be identified in searches of public real estate and court data without individually pulling case files, experts say.

But nobody questions that they are on the increase.

David Rothstein, a researcher with Policy Matters Ohio, summarized the way they occur like this:
• The lender files a foreclosure, gets the foreclosure judgment in court, takes the property to sheriff’s auction but doesn’t bid on it if no one else does.
• The lender files as above, gets the judgment, sets the sheriff’s auction, then cancels the sale at the last minute.
• The lender files as above but then never requests a sheriff’s auction.
• The lender doesn’t even bother to file foreclosure.
All of these actions leave the foreclosed property in the hands of the original owner who, in many cases, has moved out and is unaware the lender hasn’t taken it.

One indicator of the trend in walkaways is the gap between the number of foreclosure filings by lenders and the number of properties actually sold at sheriff’s auction.

A Dayton Daily News analysis of Montgomery County records found that, through September, foreclosure filings are on a pace this year to decrease by 8 percent. Meanwhile, foreclosed properties sold at sheriff’s sale will be down more than 21 percent. Over the three years an average of 2,500 foreclosure filings have not made it to sale at auction.

Excerpt: http://www.daytondailynews.com/news/dayton-news/drop-in-foreclosures-called-very-scary-352689.html

Sounds like a new opportunity for the Great American Squatter. Obama should claim credit for this as soon as possible.

I read Joe’s post about 5 times. And I can’t make head or tail of this secured lender strategy.

And . . . it’s not even after 5 on the right coast!!

Write off the bad debt, get bucks from Uncle Sam, no need to screw with expense of selling the place?

And hold assets than on paper are worth much more than they are in the real world.

In other words, many of these banks that are doing this are really insolvent but you can’t tell because they are not honestly reporting the true value of their assets.

It’s illegal but .gov is looking the other way and is therefore complicit.

Welcome to the banana republic of Amerikaa:(

It would appear that some things just ain’t fixable, not even by government. I guess it would be good to look back to the Great Depression and see how these inconsistencies were handled and how long it took just to get an idea on where we are in the cycle.

If we are not a nation of law then we are nothing special.

The laws exist enforcement is AWOL.

There are many win .gov and wall street that belong in jail.

I am not following how banks who refuse to foreclose on a property are breaking the law, can you elaborate?

I’m still trying to get my head around why they are refusing to foreclose. In the absence of the property’s being a Superfund site, I don’t get it.

Example:

The bank holds a mortgage on a property for whch $500,000 is still owed.

The owner has not paid his mortgage payment for months.

The bank threatens foreclosure but never proceeds through to the sheriffs sale and the property actually changing ownership.

The bank is able to say it has a $500,000 dollar asset on its books but in reality the current market only gives the property a value of $300,000.

As long as they don’t proceed to the sale of the property they naver have to realize the $200,000 actual loss.

Now multiply that by the number of mortgages that many banks hold that are in default and you can see why they are not solvent.

The lie continues and and the regulators, .gov and the politicians look the other way.

Becaue they would immediately be considered bankrupt themselves. See above example.

Well, that is definitely whistling past the graveyard. Or postponing the inevitable. Choose one of the above.

Here is guy specializing in buying beaten up banks.

He’s not buying.

That’s what’s known as fire discipline.

That’s what’s known as fire discipline.

But I repeat myself.

Damn Bush! :roll:

Every month, Bank America has been threatening foreclosure on me ever since they bought my mortgage, even though i can prove every payment is made on time. They say it is because they have not located all of the paper work yet. I think it is because they are trying to look in worse condition than they really are, so they can get another bailout! :mad:

What Larson posted is true but here are some more reasons.

The banks have learned alot in the last couple of years.

  1. Most of the people who walked away from their mortgage had abused the houses and/or the HVAC and roof needed replacing anyway.

  2. Vacant houses get vandalized.

  3. Vacant houses often leak and grow mold.

  4. The gov told them to slow down the evictions and foreclosures.

  5. The city or county can make the bank clean up these torn up properties or assess fines. They need the original borrower’s name to stay on the paperwork for the houses that are in poor shape.