you have been weighed on the scales and found wanting
I was one of the first people to register for online foreclosure auctions hosted by municipalities. I have not paid much attention until recently. It took only a few minutes, a few municipalities and already I am worried. I am not worried that I may not get a “bargain”, instead, I am worried of a few dangerous trends that will only ensure that more Americans will not achieve the American Dream (an opinion on this to follow).
I like to examine historical data in order to make an educated guess as to where a property may fall at auction. This is what I found 53% of the times:
Auction Type: Foreclosure
Final Judgment Amount: $140,720.78
Assessed Value: $51,138.00
Plaintiff Max Bid: $151,116.70
I scratch my head when I saw this for a few reasons:
1. If the assessed value is $51,138.00, a “normal” person would bid below or up to the assess value so as not to start out with negative equity.
2. The Plaintiff (Federal National Mortgage Association) placed a bid, even far more than the judgment.
It would seem to me that lenders (after getting their billions from our tax paying dollars), are not interested in giving up the inventory on the market. By bidding so high, they are ensuring that the banks are now in the real estate business.
This particular case was even more interesting when I found that the property in question had Chinese drywall and has not yet been remediated. Why would a lender knowing these minimum details not be willing to allow this house to pass for a cash sale?
The second disturbing trend involves realtors. Yes, the same people who made millions selling homes to people who could not afford them.
A disturbing amount of houses are being gobbled up by Realtors at auctions and then relisted for profit. I have been chasing two realtors for the last three months, and they buy properties, then relist them for as much as 500% of the price at auction.
This is as bad as the bank bidding ridiculous figures for the homes. Home sales are not increasing in some of these areas (notably Jacksonville and Lee County), so why are realtors hording foreclosed homes then relisting at ridiculous prices?
There should be some limit placed on the quantity of foreclosed homes a person or business that is not the plaintiff is allowed to buy within a given period. I hear someone screaming free market and capitalism, but isn’t that what just brought this country to its knees. Not really free market, not really capitalism, just greed.
