The Real Story…
News and commentary about the real estate market and related topics.
Dave Parrish, ABR®, CRSA, CSP, GRI, ePRO®,REALTOR ®, RealtySouth
The opinions expressed here are my own and don’t necessarily represent those of HomeServices South.
Freezing of Foreclosures…
It’s the story of the week… maybe the month. Foreclosures halted in 23 states due to the “robo- signing” scandal and the exposure of a corrupt process… Bank of America’s decision to freeze foreclosures in all 50 states pending their completion of a review, the call for all major lenders to suspend foreclosures until completion of the review of the process. Proposed congressional hearings in November (after the election) to look into the irregularities associated with the foreclosure process.
The impact of this new flavor of the housing crisis is potentially huge, so we are being told… It is certainly true that freezing foreclosures will extend the time period to put their impact on the market behind us. At the same time, what appears to be a disregard for due process and honesty speaks profoundly of a sort of bankruptcy of the banks who were themselves saved by the intervention of the government.
The apparent ineffectiveness of the Home Affordable Modification Program (HAMP) is at least in part due to the mortgage servicing companies’ ability to charge higher fees for processing foreclosures than doing loan modifications. How many people will be helped by the freezing of foreclosures will likely be small. Even so, we owe it to ourselves to ensure that the process is at the very least fair and legal.
We’ve been told: When written in Chinese the word crisis is composed of two characters. One represents danger, and the other represents opportunity. While the accuracy of this translation may be in question, perhaps we can use this moment to evaluate the environment that seems to repeatedly bring about crisis.
Perhaps this time our leaders can take steps to truly ameliorate the banking environment to better serve the nation and its people. I would suggest that as part of the overall solution to the misconduct and abuses of the huge national banks and the jeopardy that hey have brought to our economy that we consider incentives that would help support small local banks with a truly vested interest in their communities and local accountability.
May the Market be with you.
