LAY DEPRESSED PRICES AT THE BANK'S THRESHOLD

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Real Estate Agent with Dunnigan, Realtors, Sacramento (916) 425-9715 CalBRE # 01188158

We should be recovering quicker.  We have more buyers than properties to sell.  Interest rates are low.  There are still people out there with solid careers.  So, what's going on?

Back in "the day", sellers would set a price.  If buyers felt their price was fair, they would agree to sell the property at that price.  There may be a bit of negotiation, but ultimately, there would be established a fair market value.  What happened?

Sellers still ask a fair price.  Buyers are willing to pay when the price is fair.  They come to terms and escrow is opened.  Then,Banks the bank decided to set the market value in their eyes.  The market value is the "safe" value that guarantees that the bank won't eat the loan...not market value.

Appraisal reform was established a few years ago to establish "arms length" determination of value.  While the idea may have had some merit, the result was anything but arms length.  Banks created Appraisal Management Companies as required by the new guidelines.  The banks owned these companies.  Then, when an appraisal was needed, the bank would assign the appraiser for the property.  The banks created a whole new revenue source and in the process, was able to control valuation of a property.

Sadly, I don't see a light at the end of this tunnel.  Banks created, through legislation, the real estate nightmare.  Banks, through legislation, now have new revenue sources.  Banks, through legislation, now have control of market values...not the consumer.

Please, tell me how we are going to get out of this mess sooner than later!

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Rainmaker
516,588
Russell Lewis
Realty Austin, Austin Texas Real Estate - Austin, TX
Broker,CLHMS,GRI

We should be recovering quicker!! Great post about this and as usual it's the banks continuing to cause more trouble for the problrms they caused in the first place!

I would love to see others opinions on this subject too!

Jan 09, 2012 11:51 PM #1
Rainmaker
208,110
Peggy Wester
Realty Executives Integrity - Grafton, WI
Real Estate Agent Ozaukee & Washington County

This is a great post -- a topic I haven't seen discussed much in recent weeks. I have to admit that I've been pretty lucky when it comes to properties appraising out. But I've heard lots of nightmares, and clearly this is yet another obstacle in the world of real estate.

Jan 09, 2012 11:55 PM #2
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Rainmaker
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Paula Swayne

Realtor-Land Park, East Sac & Curtis Park -Dunniga
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