With a pocket full of our $750 Billion and a completly clean bad debt on their books (because they realized all bad debt in December of 2008) we are now seeing the banks begin the same thinkin in which began the Economic Crisis in the first place... bad decisions, lack of intelligent decision makers, and a complete inept work ethic the big banks are once again trying to instill their way in the market place. Do you think the banks would ever consider it to behoove them to pay attention to the real estate markets before they go off half cocked with real estate decisions. For example, IndyMac Federal Bank, has had in their grips an offer for a property in which has never had a payment made on the $510K mortgage Fannie Mae paid way back in 2006 since August of 2008. Since that time they have pushed the account to the 3rd party Loss Mitigation contractors they choose to use, who have had it with 2 separate negotiators,a nd then Pulled it back from the 3rd Party Sub-Contractor to deal with the Short Sale in house, but I have yet to have any contact with Sarah Hammel, IndyMac Negotiator, or any other member of the IndyMac Staff. Since August the ever volatile Chicago Real Estate Market has plummeted aand the offer which was once written for $250k is now at $210K (a gift if you ask me) and yet they will not find any reason in their corporate structure to actually settle this account once and for all... Why should they? They have already realized the loss on the property by writing it off in December of 2008 so as it sits it is merely another log in the log jam which is the infrastructure of solving our economic dilemma. Huh, funny how we rely on the same institutions which caused the problems, as they sit, to solve them as well.... We are in for a long aand winding road.
With so much REO inventory, this is a good sign. Once prices go up on REO, maybe we will see real estate get back to normal. I predict 2012 before we are in a "normal" market again.
If only life were that simple... I do not know who you are working mostly with, but I am mainly working with buyers whom fall in two categories... 1st time home buyers looking to buy equity, or investors who are looking to buy huge equity... So, if they start pushing their weight around with our tax dollars, I fear a lengthening in the recession....
We are still in tumultuous waters. . .our market should settle down by years end. .
Rick, your post is completely right. It's the same rotten behavior all over again. I wish agents and Realtors would boycott all short sales in the market. Let the banks deal with the full brunt of foreclosing or mitigating, either one. Let the banks incur all costs involved with carrying month-to-month, legal issues, selling, repairing, etc.
It's so sad that agents get pulled into this GAME with banks. I don't care how many 'success' stories I hear about short sales, the seminars teaching them, continuing ed on them, I will not touch them.
I wrote an article here two days ago about this exact subject. They should be completely boycotted by us. Let someone else waste their time.
GOOD LUCK
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