Realtor Letter to Foreclosure Bankers

Oh I could not agree more!  And there are so many- you would think they would want to ease there pain and get the plate emptied.

And for added fun- in our area- PIPES FREEZE AT -20 !

I have been dealing with multiple properties where the bank is in a warm climate and they don't get that you can't leave an unoccupied home in Minnesota with the heat shut off.

So Much damage it is just sad- and un necessary.  Plus they hire the bottom of the barrel Realtors to handle these properties and they are overwhelmed also.  It takes months to get and answer to a PA and another 3 months if your lucky to close them.  With all the other properties for sale- they buyers just move on when they can't get an answer.

Very Frustrating!  Your right on Lady... Now if the powers that be would just get it...

Lori Melstrom

Edina Realty Wayzata MN

I would not estimate that you might not remember the S & L scandels of 87. But the banks are not in the business of making money off the loans for a profit. They buy and sell these notes as fast as they can to pay for employees...the real money to make is for the share holders. You're right in the fact that they don't want the houses...it's nopt houses they see...it's notes...paper...to be traded on the open market. If they manage the money pourly, it is the taxpayers problem and the government will bail them out when it gets to the big banks...that is why they raised the Fannie and Freddie limits on paper...no real houses are attached, and so no emotion is involved...it's just business as usual.

The problem is that banks don't understand that short pays are a better option then foreclosure.  Most banks have gotten rid of anyone who understands what is actually happening because they have to pay them too much.  In the last go 'round in the 90's most banks didn't understand the benefits of accepting shor sales until the end of the cycle.  i suspect it will be the same this time around.

David Your assuming their is an emotional attachment...the banks just see it as a piece of paper to be processed. If the clerk that is handleing it that day doesn't feel good and goes home early...it's no big deal to them. If it actually goes on the foreclosure list....the manager sometimes will let it sit their and later buy it for himself. But you forgot the writeoff part also. And the fact that some where being held in anticipation of Fannie and Freddie haveing their limits raised....now we can write more bad paper....bad paper is an asset...same as a good paper....the house is just colateral for the note. And whom really gets stuck with the bad paper? Us....the taxpayer...passed on from the government....just like in 87 with the Savings & Loan Bailout.

It's a bottleneck.  Badly handled, makes people suffer from the bureaucracy, the process could definitely be speeded up in lots of ways. ust a big mess all around.

This is generally what happens when you are dealing with a bureaucracy. There is never enough people in place to make proper decisions. In the end it certainly costs the bank $$$.

I am going to see if I can figure out why I am not showing up on Ziggs...not sure could be a glitch?

Here's a thought, how about if the banks actually have some form of communication between Loss Mitigation, REO and the Bancrupcy Departments. They are bogged down with over 400 new files a day, but some files float back and forth between departments, and the prevailing sop is just get it off my desk. I had a homeowner that tried for a loan modification for 90 days, someone at the bank said "it doesn't look good" so she puts the home on the market, gets an offer, and we try to negotiate a short sale. When I call the bank they say "oh her loan modification was approved yesterday" (130 days after initiating loan modification) But guess what her payment was going to be $2600 a month, $500 more than it was when she couldn't pay it to begin with. Does this make any sense? Now the short sale has been at the lender for 45 days, and still no approval, Still Waiting!

Hi Gena...Let me say Bravo! That is the best letter i've heard and should be sent each week to the CEO's of each lending institution.

Hi Gena - oh how I wish all those banks would see this post and pay close attention to it.  They'd surely be able to cut their losses and get more properties sold quicker if they'd hire a few more people to deal with those files and who could actually respond to offers when they receive them.  And the title companies - yep, spread the wealth please!!

Ann

Billie your just too funny...ever been in the Military...haveing these people talk to each other is like asking Officers wives to talk with Enlisted personel, and Enlisted personel listening to Officers wives....hehehe...my son is in the Air Force....hasn't changed in the last 30 years...and probable won't in the next 30.

Nice!  I would like to add, Dear Bankers, why don't you hire a 3rd party company with structured  parameter's to help you negotiate and move this inventory. If you can't handle in house.  I think there are a few real estate and lenders out there who could handle this for you and guess what they know the business. (oops did that write out loud!)

Hi Gena,

The only thing I think I'd add would be "hire more knowledgeable mitigators."  Too much inventory, too few facilitators.

Lynda, I totally agree. We need more knowledgeable mitigators.  Thank you for your comment.

Kelly, although there are some knowledgeable real estate lenders out there, there are also some sleazy ones. We definitely don't need to go there, right?

Chuck, yep you are probably right...however, I believe you might agree that this "paper" will cost the banks more money if the longer they hold the property. Whether or not there is emotion on their part (which is NONE), the point is that this costs MORE the longer it is allowed to continue. Agree? Thank you for all of your comments and getting right in there with a lot of meat.

Ann, would you mind sending this to a few banks? We really do need to move these homes quicker. The Home Buyers and the Sellers who are in Short Sale are quite anxious and deserve to have an answer much quicker than the banks are doing now.  Thank you so much for your comment.

Mr Short Sale, why thank you. I wish I could send it each week to the banks. It needs to be read by them and they need to wake up and get with the program. Glad you liked the article.

Billie, that's due to the convoluted way we think we do business. We hire a ton of people, give them some menial portion of a task and then pass the next task off to another. In the olden times, a hiree could actually handle the entire file and not pass it on to another. That's just another thing that needs fixing!

David S and Chuck Christensen,

Please take a couple of minutes and look up "there" and "their" in the dictionary.     I don't mean to be rude, but it makes it difficult to read your otherwise intelligent posts with your misuse of pronouns.

Bill,you're absolutely right...bureaucracy at its best or is that its worst. It's no wonder we have a deficit in our economy. It takes too many people that get paid too much to tell us that we are in the hole. Thanks Bill.  Hope you were able to have yourself show in Ziggs.

Miriam, I feel so sorry for the home sellers going through the short sale with a sense of hopelessness since the banks really don't want to even answer an offer and feel for the home buyer who makes an offer on short sales and foreclosures never knowing if and when they will ever hear from the bank. This is NO WAY to do business. Most unacceptable. Thanks for popping in and joining in with your comment.

David, I totally disagree. I don't think it's in the best interest of the bank to not accept offers on a short sale. It is very costly to foreclose and depending on how long the house stays in foreclosure, the more it costs. Why do you assume that an offer on a short sale would not close or did I read your comment wrong?

Kaye, don't you find this so defeating? We should have learned something from the last time around. It's time these folks wake up, call someone who was around back in the 90's and ask, then apply...oh my!! Thank you for your comment...now for getting these newbies that are being paid at a lower rate a little education before we prolong this any longer than necessary.

Lori, how sad! So much waste and needless time being prolonged. For the life of me, I can't even begin to understand how anyone with an IQ of over 90 could possibly not understand that business as usual needs to be CHANGED. Very frustrating and I hear your pain...I just wish that the banks could hear the pain and be able to understand that this pain is costing MONEY to them.

Hey, as long as I'm here, LOL. We all have our share of problems with banks on short sales, and surprise! They tend to change from day to day, just in case we're getting bored or too used to the status quo. I suspect banks know they need to dump their inventory, but they are also ordering more than a BPO now, they're getting full fledged appraisals on short sales. If the bank thinks it can do better in the market with a bank-owned property, that's what they will do. Which is why short sales aren't that hot of a deal for buyers.

Bank of America, for example, tells me it wants 90% of appraised value, including the costs to sell, which isn't really 90%, if you get my drift.

I had a listing in Land Park on a short sale. We offered the bank $220,000, and it flat out rejected the deal. In fact, in the midst of negotiations, I was called by another agent who was in the process of listing it as a bank-owned property. They told me they were postponing the trustee's sale when they weren't. That poor agent ended up listing it as an REO at $300K. Since then, it reduced to $235,000. Guess where it will likely sell? Probably at the short sale price it was offered. If only the bank had responded . . . countered . . . but banks will learn. They won't learn from you or me. They will learn from their own mistakes. Which, when you think about it, is about the worst way to learn anything. :)

Elizabeth, excellent comment. And right on. I've been told the Banks want 95% of the current value. But whose counting...obviously not the Banks. Totally agree with you. It's sad to see this and to see it continue and continue and continue.

Were you aware of the auction that took place on the West Sac townhomes? I was shocked to find out that the people who bid the highest and thought they got a townhouse found in less than 30 days that the Bank didn't accept the offer. And now, they sit. Unreal, if you ask me.

Love to know what it takes to have the Banks WAKE UP!

Thank you for your insightful comment.

you are so right ! Come on banks get with the program! Way to put it in a nice way

Shannon, Nice is getting a little old...they really do need to get with the program so that not only they can move on but so can the rest of the economy.

Thanks for popping in

Gena,

  Are you actively working the REO Market ? I am trying to get into it in the Portland Oregon area and I am a very experienced 25+ year Real Estate Veteran and a Principal Broker and I cannot seem to get them to give me the time of day.... Any ideas ?

       Doug

Thank you! I am working with a customer who is attempting to purchase a REO that the bank has listed for $110,000; the customer offered $107,000, with the bank paying 3% closing concessions, and the payoff on the property is $99,000. The bank's answer... "we will consider the offer, however, please understand our position..." What position? They stand to net a profit on the transaction, albeit nominal, yet a profit. Go figure. Some bank standards, I've found, to just simply be tighter than others.

Doug, I really don't know what you can do in your area. Have you been doing BPO's and gotten acquainted that way? Perhaps you don't have enough of them in your area. I would speak to someone who is working with REO's in your area and ask them. In the beginning you had to attend a conference, pay money and be interviewed but now with as many as there are, it doesn't seem to matter, here.

Bo Hunt, Sounds like the banks are pretty picky in Atlanta. I guess you don't have a slew of foreclosures there. The banks really need to get their act together quickly.