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82 Comments on Banks Are Prohibited From Entering Into Real Estate Brokerage And Management Businesses? Really?
I agree with your bullet points and premise. I wonder if some of the language in the banks' contracts aren't there to encourage owner occupied. We all know what happens to areas that have cheap, foreclosed properties and investors swarm in.
congratulations for adding a meaty topic to the discussion.i've advised many clients to sue their lenders for a variety of crooked practices and only two have...both are well under way in their cases and the outcomes look like they will be good ones. those who permit the banks to dictate terms have no one but themselves to blame.
i saw a listing note last week where the owner was forced to submit to an "auction" as a condition of the sale rather than simply go through the common short sale. can you imagine the size of the sack on the lender demanding that? the agent that permitted that should be sanctioned and removed from the trade for failing to advise their client capably.
even as a free market libertarian i cannot imagine having the banks in my trade...everything they touch turns to shite and they rely on the taxpayer to bail them out. in japan businessmen this inept commit suicide to erase the shame from their family name...in the U.S. they line up for a bailout and then take a juicy bonus...or even worse the failed bankers reconstitute a new entity like PennyMac to pick the bones of the rubbish loans they made that were the cause of the meltdown...for fun google the management of pennymac. you cannot make this stuff up.
The eyes gave you away Bryant. LOL! But this is really good info and spot on. Another Socialist ploy and feather in the cap of our government who I hold responsible for most of the mess that's been caused in the lending and RE arena of late.
Pigs are certainly flying. I did some articles awhile back about all of these Help for Homeowner programs and highlighted the consultants (lobbyists) pushing for them which were the big Banksters.
Paul's comment in #61 about highly suggesting reading "The Creature from Jekyll Island" by G. Edward Griffin is spot on. You'll then know why we call them the "Banksters".
Enjoy that new Chase App BTW.
Bankers might argue that there is a fine line to be drawn between things that control a real estate transaction and things that are done to protect depositors' money.
They might claim that they have the right to specify under which conditions they are willing to take a loss on a problematic loan.
They would point out that no Realtor is being forced to work on short sales, and that they do it because they want to earn commissions
Lenders have a right to dictate the conditions under which they will make their loans.
I agree that lenders make things unnecessarily complicated and difficult in short sale situations, but I am not sure that this is the same as being in the real estate business. Being the the business is usually understood to mean providing services for which the provider is being paid, and so far banks are not being permitted to perform those things which are normally considered activities that require a real estate license.
Home owners always have the right not to include banks in their purchase transaction - just pay cash.
NOBODY went to jail!!! Think about it. After all the sleight of hand and downright thievery of the last decade. lenders received a slap on the hand and a few fines that they write off as costs of doing business as usual, and every body at the top went right back to work. Only the bottom ranks ranks got slashed, many never rehired. The banks have been given a blueprint for running roughshod over the real estate industry and their customers.
That's the way it seems to me.
Great Job and very good points!
...And while I'm ranting, what about having us collect all that very personal information from both short sale sellers and BUYERS. Why are we in the middle of that mess. Couldn't that be really dangerous, both for us and for the people emailing, faxing and otherwise providing us with such intimate information which we then email, mail, fax or upload via the internet.
Why should such volatile info be passing through the hands of we real estate agents anyway?
It just feels so yucky sometimes! I love being able to help home owners in trouble, I even like working with the short sale personnel on the other end, they are just doing their jobs -- but I don't like handling all of that info.
And I hope our so-called representatives will be ready to step in and defend us wqhen someone's info ends up in the wrong hands.
Thank you, Bryant for bringing up a multi-layered discussion involving the US banking system.
Banks have been functioning in this fashion, i.e. covertly finding new schemes to find more profits, since banks began. So for me, this is not really political. It is a cultural dilemma.
We love to make money. And why not? It’s great to be successful, feel secure and feed our egos a bit. But when I have a good year, I try to spread it around the economy by spending some, contributing some to my community, investing some and saving some. When I have a bad year, I cut back without expecting anyone to bail me out. The banks don’t. Their fiduciary profile is ghastly. As each decade passes, they develop new furtive ways to skirt the regulations and reward themselves beyond the imagination. Banks operate with seeming impunity.
What happened to the community savings and loans? My first home was financed by the Los Angeles Savings and Loan who still held my loan when I sold that house 10 years later. That was before the banks took over the Savings and Loan Industry, turning a once consumer oriented and real estate industry friendly system into the pain we all feel today. Underwriters are acting like dictators, messing with borrowers whether the buyer as millions of dollars or thousands. These underwriters’ power is overwhelming. They are holding on to their money and gloating. Who hasn’t lost a sale because the lender took too long, or lost the paperwork or whatever….. Time is of the essence? Really?
It took many decades to reach today’s national fiscal debacle. I do not think any government with a variety of opposing political and philosophical positions over decades is capable of agreeing on anything this massive. Don't give government too much credit for a truly clever, underhanded and highly profitable banking system that defies all standards of fairness. Banks own the government right now as evidenced by their continued colluding against the consumer. Their shriek whenever reining in their reach is mentioned is heeded by those "in charge".
The local lenders we use on the Outer Banks who have decentralized underwriting operations, are definitely delivering a more consumer friendly product illustrating the core of our predicament.
In a capitalist society money is power and power craves money. It is not evil. It is the essence of Capitalism. However, I agree with you that our banking system is slated to destroy our leverage as it continues to grow "Too Big To Fail".
The very people defiled by the banks are the ones who bail them out when they go broke. You've got to admit it is genius.
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Unfortunately, this situation will only get worse as the economy craters and the government gives the banks more bailouts and, as a result, more power. In the end, we will all be beholden to the big banks.
There's no question that the banks are crooked and they are overstepping their bounds while they violate real estate laws. The big question is this: What do we DO to put them back in their rightful place?
WOW!!! Really awesome comments. You guys are MUCH smarter than me.
I completely agree that banks should handle their REOs as they see fit. They own the property and can pretty much do what they want.
But interfering with contracts where they are notthe seller or buyer is criminal in my opinion. There a HGUGE differencve between a lender stating "we will only allow 6% commisison paid from the proceeds of the sale? and "You can't make more than 6% period". Restricting how I charge and how much I charge for my services is interfering with free trade. I shouild be free to collect commission or fees dorectly form my seller or buyer at time of closing. As long as it is not coming from the proceeds of the sale then it is truly none of the banks business.
Of course must of the bad loans are now being transferred to non banking entities to avoid any oversight anyways.
Your last comment Bryant hits it on the head.."of course they are being transferred.." Banks should NOT be "too big to fail." I pulled my money out of the large banks and went small and local. Feel much better about it. Encourage everyone to do it!
and there are credit unions that own real estate companies ... I think NAR may have lost sight of what is going on ... or is afraid to fight the big boys ... or ???
Banksters are trying to take over the real estate business the way the insurance companies took over our health care. Our government allowed the insurance companies to do this and they are now helping the banks to destroy our right to buy, sell, and own real estate. Greedy buggers. We elect people to the House & Senate but, once in, they seem to have no allegiance to their constituents. Their job is to protect the people from corporations. Our elected officials are not doing their jobs.
Maria in #82: Sometimes the best things these elected officials can do is to protect their constituents from themselves... although in light of some of the dweebs these constituents elect to Congress, those who elected them deserve everything they are getting.
As far as so many of the comments above, if the contract for sale is contingent upon the approval of the Short Sale/lender... then that lender can insist on whatever they want to... as long as they are not breaking any laws. And I mean REALLY breaking laws, and not just in the opinion of those in the comments.
I have not read all of the comments, but I have read the last twenty of them. Out of all of those comments, the only person I feel I can agree with is Thomas McCombs in comment #69. Folks, the rest of you can't just make stuff up just because you don't like how things are going.
The Short Sale lender is eating an awful lot of cash in order to make the Short Sale work. They are letting the Seller off one heck of a hook.
If both the buyer and the seller have agreed that the transaction is contingent on the approval of the Short Sale lender... then... that's it. Game over. It's either that, or foreclosure. Or, go buy/sell a different house.
I Was Thinking The Same Thing about all the Ruckus Made About Banks Getting In The Real Estate Business, And How They Pretty Much Control The Inventory Lately and How The Market Continues to be Artificially Manipulated, as Well As The Supply/Demand.
A Recent RE Instructor said that we all would be working for banks in a few years at $17 an Hour + Benefits. The Banks "Backed In" But The Government (read Taxpayers = US) Guarantees/Bailouts/Stimulants Paved The Way With "Make Believe Land" Dollars. Government - Insurance - Banks are too big too fail OR accept responsibilty. They have effectively Killed The Goose (REAL ESTATE) That Was Laying The Golden Eggs with Their Ego & Greed. Now They Are Doing The "Resurrection Boogie". I hear Them Propping Up The Goose Now...
"WE THE PEOPLE" NOT "WE THE CORPORATIONS" Let The Marketplace Cycle!
People Have Not Stopped Living In Houses
When You get Goose Eggs Make "Goose Eggs Benedict"
Walter Kaminski In Largo, Florida Email: ActiveRain@Budrox.com
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