Foreclosure Value
Foreclosure Value
Why banks do not lose 50% of the value of homes in foreclosure, instead of falling mortgage rates a bit?
But why yes, I read the news. This has prompted the question: Dodd told them they have to fight the foreclosure fiasco by setting conditions lending to borrowers continue to make certain payments, instead of stopping completely. bank foreclosure procedures cost about 50% of the property value. This is assuming that the house can be sold – not a certainty when the empty houses are multiplying in a neighborhood. "What do you? "Dodd asked the Executive Officer." What should you do to help modify loans? "And yes, even loans that have not yet changed. These people, or purchased on your price range, the loss of a job or some other fees at the beginning. We can not save them all, but we can do better than us.
The banks decided by the committees and often do not make the best decisions. And he concluded a legally binding link between the buyer / owner and the Bank, not your fault / responsibility if the buyer is underwater on the loan, especially when the buyer was using the house as an ATM and withdraw money from HELOC and redid. There are also legal problems renegotiation of the loan rate if the mortgage is sold (including securitized loans). And sometimes asking for a loan modification, you can not do rotate the payment and keep the house and the bank has spent much time and money for nothing. And there is no guarantee at all that the bank will lose 50% of value, except when they made the 100% financing.
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