Valley Investors Avoiding Foreclosure Auctions

Posted in Foreclosure, Foreclosure Auction, July 10th, 2007 |

There are just too many homes for lenders – much more than they can swallow. Where is the cash? The figure runs into tens of thousands of dollars. Tom Ruff researching in data says that the rates have plummeted. There is not much equity left even if the lenders cough up the cash and buy the units up for auction. The bait of discount sale of the properties is just not profitable any longer.

All over the valley third parties bought 18% of the foreclosed 876 properties last month. They were the traditional investors. According to Information Market figures the lenders took back 82%. It’s a quick U turn from the figures of June last year (2005) when investors grabbed 75% of 105 properties that had been foreclosed. Ruff opined that was time when the market was hot and boiling. It was the right time for investors to take risks underlined with hopes. But property prices have suddenly become to stagnate causing many would-be investors from staying clear of buying foreclosure properties. This leaves the lenders weighed down with monetary burdens.

Taking back a home is not just about paying the price of the property but also includes attorney fees, repairs, upkeep and maintenance of the units and then the botheration of marketing it all over again.

Eric Bowley of AmeriFirst Financial in Mesa says that quite a few lenders are being compelled to buy back loans that had gone bad. These units they had sold to national mortgage servicing companies and or to investors from Wall Street. The snowballing effect is that a good number of firms are pulling down shutters. He goes on to add that it is sad to see that many have to sleep on the same beds that they have made for themselves.

Patti Crawford of Intero Real Estate Services is vociferous about the problem being endemic right across the country cutting through all income levels. As examples she cited two instances. A 2-roomed unit off Thunder Bird in West Valley and another 4 roomed house were placed in the market by the lender for $45,000 and $1.6 million respectively. She said that properties are being driven back home in herds!

Crawford warned borrowers to read and to be careful where they put their signatures. Many were pressurized by unlicensed greedy lenders trying to make hay when the sun was shining.

Via