Orlando Real Estate

Banks and Real Estate 1 of 2

May 18th, 2010 9:10 AM by David W. Welch

Forever it seems, banks have been trying to get into real estate. With all the short sales and foreclosures (2/3 of our sales here in Orlando) they have finally gotten what they wanted. Realtors have fought legislation time and time again that would have allowed banks into the real estate market, and now with banks controlling so many real estate transactions, everyone can see why. As Realtors, we must put our customers best interest ahead of our own. Banks really do not have an obligation to anyone but their own financial statements. Quite frankly, I question a lot of their decision making as it relates to their own financials.

Let's take for instance two government programs designed keep people in their homes and help others get into their first home. These are true stories of real people. The first story is about a couple who tried for nearly two years to get a short sale approved. Eventually, the financial stresses ended their marriage. At that point, they approached the bank for a loan modification. That way one spouse could move on, and the other could move back into the home. After being told the loan modification was approved, and "the papers are being sent," one moved back into the home. The papers never showed up and they have spent two months trying to get the modification finalized. Things are just beginning to improve financially, and now the bank says they do not qualify for the modification. They also have offered no options for restructuring the loan. The bank's answer is to pay up the $30,000 they are behind, or else they are going to foreclose. Or...they can start the short sale process again. The home is probably worth $80,000 less than what is owed. So tell me how this makes any sense. The bank could restructure the loan and get paid most if not all of what they are owed. In stead they would rather foreclose and lose $100,000 or short sale and lose $80,000.

David Welch Real Estate Optimist, Orlando Real Estate

Posted in:General
Posted by David W. Welch on May 18th, 2010 9:10 AM


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