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Mr. Lender, you are no different than a home owner who is under water.

December 10, 2010

Mr. Lender, you are no different than a home owner who is under water.

Foreclosures and the banksI am involved in an REO in a neighboring town. I was asked to do a driveby BPO, the lender already had their driveby appraisal, however I seriously doubt that it was an appraiser who did it. I think, based on the price, it was an out of town real estate agent who did it. A visiting real estate agent from Mars perhaps, on a work exchange program. 

First I went over with my broker, we did a drive by for the initial BPO. The home is in an estate area, certainly not an estate quality home. Really not an estate quality home, to say the least. This first trip we did not step on the property as the foreclosure was looming large but the date had not arrived yet.

Fast forward a week, the lender told us a judgment for foreclosure had happened. I wanted to verify this myself so I checked the State of CT judicial website, was mystified by what I saw and asked a real estate attorney to help me decipher my findings. Even she was a bit mystified. Her best guess was the lender owned the property. OK, that worried me a bit.

The next step, a trip back to determine if the house was vacant. Two unregistered vehicles had been moved to a different location on the property, the kitchen was being systematically dismantled, the house was full of items and trash. That was all I could see as we still couldn’t get inside. And based on the judicial website I would guess that an order of ejectment should have been issued. Maybe I should have driven by at night, but honestly, I had no signed listing contract, it is not like I drive by there all the time so I wasn’t going to do that.

Our BPO was about $200,000 lower than the other drive by appraisal or BPO. The lender was sitting trying to decide what to do as a result of this. Indecision’s, indecision’s. They are into it for quite a bit more as they had paid off other lien holders.

The weather gets colder and colder as they try to decide what to do. This is a local lender, they approve and pay the vendors directly. A packet is sent to us, we have the vendor fill it out, they pay the vendor directly. And not as fast as they should I might add. They start foreclosure proceedings if a home owner missed as many months payments as they take to pay a vendor, if you know what I mean.

So we wait. While the temperature plummets to the low teens for a few nights in a row. I am positive the pipes have frozen, the kitchen must now be devoid of any and all appliances, cabinets, etc. Who knows if there are even any toilets or sinks left in the bathrooms? Indecision’s, indecision’s yet again.

Why call a real estate professional if they are not ready to take our advice? If we tell home owners that it doesn’t matter what they need to get out of the property, why should it be different for a lender? If we tell home owners that they must take care of a property, why is that different for a lender?

Maybe the lenders need to do short sales on the properties they now own. Of course I say that with the idea that the file should be given to a lender such as OCWAN. That might help them with the whole indecision thing in future sales.

Lenders want home owners to take care of their properties when they give out mortgages. Why is it any different for them when they own a property? They are killing the real estate market with this attitude.

Mr. Lender, you are no different than a home owner who owes more than the property is worth. I don’t care what you “need” to recoup. You really should understand that, you hear it day in and day out after all.

And FYI, your indecision probably just knocked off another $50,000 of the value of your lovely home.

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