Bank walk aways on rise

Discussion in 'Economy' started by Truthmatters, Mar 30, 2009.

  1. Truthmatters
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    The New York Times > Log In

    City officials and housing advocates here and in cities as varied as Buffalo, Kansas City, Mo., and Jacksonville, Fla., say they are seeing an unsettling development: Banks are quietly declining to take possession of properties at the end of the foreclosure process, most often because the cost of the ordeal — from legal fees to maintenance — exceeds the diminishing value of the real estate.

    The so-called bank walkaways rarely mean relief for the property owners, caught unaware months after the fact, and often mean additional financial burdens and bureaucratic headaches. Technically, they still owe on the mortgage, but as a practicality, rarely would a mortgage holder receive any more payments on the loan. The way mortgages are bundled and resold, it can be enormously time-consuming just trying to determine what company holds the loan on a property thought to be in foreclosure.
     
  2. Toro
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    Awesome.
     
  3. Peejay
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    Loaned money they didn't have on collateral they didn't want and couldn't keep.
     
  4. Tech_Esq
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    Tech_Esq Sic Semper Tyrannis!

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    So, I'm confused. Does that mean the "home owner" get to stay but doesn't have to pay? :confused:

    I mean if the bank won't take possession, and nobody else cares, what would prevent them from staying. (OK, maybe the sheriff puts them out, but if they moved back in, who would care?)
     
  5. Peejay
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    The way I read the article, the home owners aren't benefitting. They have been put out by this time. Moving back in probably is not much of an option.

    These houses will probably just sit there until either the bank can wade through the mess and afford to take posession or until the county taxes aren't paid and the county will auction these homes off for tax value.

    Someone is going to make a ton of money, somewhere down the road.
     
  6. Tech_Esq
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    Hmmmm....one of the places is KC, Amanda should keep an eye out. She might be able buy a house for $10k some day soon.
     
  7. Truthmatters
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    They end up being torn down bacause they end up damaged by weather and vandals.
     
  8. Peejay
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    Yes, well, if you have cash. Cash is king right now.

    This scenario played out and is still happening in my town. It's a dead mill town, the textile mill left 30 years ago. About every 4th house is empty. Many falling apart. The banks lost interest in claiming defaulted properties because it cost more to pay the taxes and keep the property up than the prospects of anyone showing up to buy. They would offer them at fire sale prices until the taxes came due and then let them go to the county. Many times, the county can't even get the back taxes out of them so they don't even sell through the county.

    I did buy my home for $10K. The previous owners mom left him a bunch of rental property. No one here pays their rent on time. Being in the rental business was a losing deal. He got tired of keeping up the taxes and you can buy his houses for real cheap. He still has several. I bought two houses and 7 acres when I first came here because it was so cheap. It only took a couple years for me to get rid of the other house and property. Can't rent it, can't do anything to make it pay, you can just pay property taxes. Bad situation.
     
  9. Truthmatters
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    That never happens in the western states.

    The weather is too good and someone buys it.
     
  10. Peejay
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    The weather is good here too !

    Just a poor economy. Has been for a long time. SC and NC both have a lot of dead or dying towns. SC more so. The loss of furniture and textile plants hurt a lot of small communities. There just aren't enough decent jobs for anyone to come here. There are a few folks that enjoy hunting and fishing that retire here with the attractive low cost of living but there isn't much else. We have 0 chain stores. No fast food, no movie theatre, no shopping.....there is one grocery, one dollar store, a couple gas stations and a timber co.

    That's all that's left in what was the largest town in the county 75 years ago.
     

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