Lenders and Banks at Orange County Should Help Borrowers Avoid Foreclosure

Lenders/Banks are in the business of lending money and usually don't want to own and manage real estate. 

When a lender/bank takes a property back via foreclosure, it's a long and expensive process (while banks lose money) and results in lender/bankers holding the property in inventory as a non-performing asset (while losing more money). 

Lender/bankers have a limit to the amount of non-performing assets they can hold (while losing even more money).  When that limit is reached, lender/bankers have strong incentive to dump properties at discounts (while losing big sums of more money). 

The number of Orange County homes in bank inventories after foreclosure – 4,852 — was up 21 percent in June 2011 as compared with June 2010 (according to ForeclosureRadar.com). 

Lender/banks don't want more foreclosures and have slowed down their processes.

Notices of foreclosure auctions on Orange County homes dropped by more than a third year in June 2011 as compared with last year, and default notice numbers were down also.

SHORT SALES can indeed be positive for the borrower and also for the lenders/bankers and their shareholders.

It would be much better for lender/banks to help borrowers do SHORT SALES in a timely manner, allow them to sell the properties, and AVOID FORECLOSURE altogether. 

Owners of properties should AVOID FORECLOSURES.  The best way for lender/banks to help Orange County borrowers and avoid having to foreclose on properties and owning non-performing assets is to ENCOURAGE SHORT SALES and streamline their approval processes.  

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This is not the providing of tax or legal services.  Any property owner who wants to start a short sale should consult with a lawyer or income tax professional about the income tax consequences of a short sale in their own personal situation.

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