[quote=briansd1]…The article said BofA will pay $13,000 to a guy for completing the short sale. He maintained the property and kept it good condition desirable to a resale. He kept the values in the neighborhood up and filled out the disclosure form for the buyer; and he’s doing all the things that BG mentioned. All of that has value more than $13,000. How much do you think BofA would have to pay lawyers and management companies in a foreclosure?…[/quote]
Thanks for bringing up the Transfer Disclosure Statement (TDS), brian. As an “institutional seller” a lender/seller doesn’t, by law, have to provide one of these because they don’t know what the seller/trustor knows about the property and so is exempt from providing it. A filled-out TDS IS worth something to a buyer but I’m not sure whether they would actually pay more for the property in a short sale as they would for an REO (where they wouldn’t get a TDS). If the short sale escrow goes smoothly and the entire process doesn’t inordinately string the buyer along, then obviously the property should sell for nearly market value. It will be interesting to see if these properties in which BAC is “paying” the short “seller” $12K+ for a smooth and successful closing are still selling at rock-bottom bargain-basement prices as they have been of late. My gut says no, unless massive amounts of foreclosures are dumped on a particular market at once. I’ve been reading lately that many metropolitan markets in the country (not just SD) now have RE inventory shortages and some are very pronounced.
Yes, the costs for lenders to “hold” property can be high. As foreclosing benes, they often get properties with 4’+ high weeds, broken windows, sewer lateral clogged, green pools, floors ripped out to (rotted) subfloor, fixtures stolen and they were squatted in w/o utils for months/years, etc. The dump fees alone on some of them have got to be >=$5K, not to mention the basic cleanup/fixup cost of readying them for sale.
