Also I need to ask, why is the game rigged? If people have enough cash to buy in bulk then why shouldn’t the seller have the option to give them a better price? Why should it matter if you are buying houses or buying soda pop? If you went to Coca Cola and offered to buy 50,000 liters of coke you probably will get a better deal wouldn’t you?
I mean it just seems like there is this anger about the discounts and the simple matter of the fact is that these deals are being done because of the volume of properties. Isn’t moving 100 properties to a single buyer in a private sale with no strings attached is a heck of alot easier then moving 100 properties to 100 different buyers some of which will not get financing. There is no contingency period, there are no dependencies, it is a straight shot. Especially in a time period where it is very important to divest of non performing assets.
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SDR,
The reason this is NOT like buying bulk from Coke is because taxpayers are not backing Coke. These lower prices result in losses in financial institutions for which WE are offering guarantees and propping up their balance sheets with various lending programs and outright “gifts” (certainly, you don’t believe them when they claim we’ll be paid in full!).
Also, housing/shelter is a basic necessity, and because of that, I have very little tolerance for price manipulation. We’re talking about setting up tomorrow’s foreclosures in order to give profits to scum who attempt to keep markets opaque, and who buy favors in the political realm.
Some of these “bulk buyers” in the mortgage market are maggots like this:
LOS ANGELES (AP) — Stanford Kurland spent nearly three decades helping build Countrywide Financial into the nation’s largest mortgage lender.
…Kurland, 55, will be chairman and CEO of a company unveiled Monday that will acquire and restructure distressed mortgages. Private National Mortgage Acceptance, also known as PennyMac, intends to help restructure loans so borrowers can avoid foreclosure and maintain payments.
“We’ll look to restructure mortgages, and as soon as the loans are reperforming, and if there’s the capability and the market liquidity, we’ll look to sell,” Kurland says. “Other properties that may take longer, we’re prepared to hold five to seven years.”
Backed by prominent investment management firms BlackRock and Highfields Capital Management, PennyMac has even set up shop in Calabasas, Calif., about 6 miles from the offices of Countrywide.
“On the one hand, you could make the case that he was (with) the company that made all these loans. On the other hand, what we need right now is to find some buyers for these assets. Is it fair?” he says. “Hard to say.”
You will find that many of the bulk buyers of REOs are people who were involved on the way up. They have the connections already and THEY are the ones who will benefit.
BTW, we are in 100% agreement about cram-downs being officially recorded and appraisers should be FORCED to use them as comps.
I’m sick and tired of seeing scammers benefit going up and down — all at the expense of regular families who are just trying to buy a home. I’d much rather see a decent family buy an affordable home than have these parasites profit a single cent from the carnage they likely had a hand in creating.
By creating an auction site and pre-qualifying bidders through Fannie/Freddie, we can be guaranted to get a better, more transparent price for the lenders **and taxpayers.**
I would NOT require Realtors to be involved at all. The NAR has managed to block banks from selling their REOs directly, but they cannot stop the government from doing so. We need to keep costs low, and I’m certain we could get a better return AND have an efficient and transparent market by having a national auction site. The government could officially recoup any costs by charging their costs against the proceeds before paying off the lenders.
If the houses are in poor condition, the buyers could also pre-qualify for an improvement loan as part of the loan qualification process.
Flippers and their ilk have done enough damage to our housing market and to our communities and financial system. Time to let them die off.
