CA Shadow Inventory

[an]

I’m not denying that the government can greatly manipulate the market. I’m just trying to understand the logic behind why banks are holding back inventory (especially when the market is showing that there are enough buyers out there right now to absorb more inventory). You’re saying decision-makers are the one that’s holding back supply. Are there many different decision-makers at a bank? If yes, then it make sense why some houses get hold back by BofA but other houses, BofA foreclosed on and put it on the market. If no, then I don’t understand why they would foreclose on some but not others.

[analyst]

[quote=AN]I’m not denying that the government can greatly manipulate the market. I’m just trying to understand the logic behind why banks are holding back inventory (especially when the market is showing that there are enough buyers out there right now to absorb more inventory). You’re saying decision-makers are the one that’s holding back supply. Are there many different decision-makers at a bank? If yes, then it make sense why some houses get hold back by BofA but other houses, BofA foreclosed on and put it on the market. If no, then I don’t understand why they would foreclose on some but not others.[/quote]
[quote=analyst] That is why you see such wide variety in the handling of individual mortgages. Each separate combination of servicer and beneficial owner is a separate discussion/negotiation. [/quote]

Bank of America is one of the three largest loan servicers in the country. It deals with many different beneficial owners of the loans it services. The borrowers may only see the name Bank of America, but the beneficial owners are the decision makers (in the cases where options exist).

[analyst]

[quote=AN]I’m not denying that the government can greatly manipulate the market. I’m just trying to understand the logic behind why banks are holding back inventory (especially when the market is showing that there are enough buyers out there right now to absorb more inventory). You’re saying decision-makers are the one that’s holding back supply. Are there many different decision-makers at a bank? If yes, then it make sense why some houses get hold back by BofA but other houses, BofA foreclosed on and put it on the market. If no, then I don’t understand why they would foreclose on some but not others.[/quote]
[quote=analyst] That is why you see such wide variety in the handling of individual mortgages. Each separate combination of servicer and beneficial owner is a separate discussion/negotiation. [/quote]

Bank of America is one of the three largest loan servicers in the country. It deals with many different beneficial owners of the loans it services. The borrowers may only see the name Bank of America, but the beneficial owners are the decision makers (in the cases where options exist).

[analyst]

[quote=AN]I’m not denying that the government can greatly manipulate the market. I’m just trying to understand the logic behind why banks are holding back inventory (especially when the market is showing that there are enough buyers out there right now to absorb more inventory). You’re saying decision-makers are the one that’s holding back supply. Are there many different decision-makers at a bank? If yes, then it make sense why some houses get hold back by BofA but other houses, BofA foreclosed on and put it on the market. If no, then I don’t understand why they would foreclose on some but not others.[/quote]
[quote=analyst] That is why you see such wide variety in the handling of individual mortgages. Each separate combination of servicer and beneficial owner is a separate discussion/negotiation. [/quote]

Bank of America is one of the three largest loan servicers in the country. It deals with many different beneficial owners of the loans it services. The borrowers may only see the name Bank of America, but the beneficial owners are the decision makers (in the cases where options exist).

[analyst]

[quote=AN]I’m not denying that the government can greatly manipulate the market. I’m just trying to understand the logic behind why banks are holding back inventory (especially when the market is showing that there are enough buyers out there right now to absorb more inventory). You’re saying decision-makers are the one that’s holding back supply. Are there many different decision-makers at a bank? If yes, then it make sense why some houses get hold back by BofA but other houses, BofA foreclosed on and put it on the market. If no, then I don’t understand why they would foreclose on some but not others.[/quote]
[quote=analyst] That is why you see such wide variety in the handling of individual mortgages. Each separate combination of servicer and beneficial owner is a separate discussion/negotiation. [/quote]

Bank of America is one of the three largest loan servicers in the country. It deals with many different beneficial owners of the loans it services. The borrowers may only see the name Bank of America, but the beneficial owners are the decision makers (in the cases where options exist).

[analyst]

[quote=AN]I’m not denying that the government can greatly manipulate the market. I’m just trying to understand the logic behind why banks are holding back inventory (especially when the market is showing that there are enough buyers out there right now to absorb more inventory). You’re saying decision-makers are the one that’s holding back supply. Are there many different decision-makers at a bank? If yes, then it make sense why some houses get hold back by BofA but other houses, BofA foreclosed on and put it on the market. If no, then I don’t understand why they would foreclose on some but not others.[/quote]
[quote=analyst] That is why you see such wide variety in the handling of individual mortgages. Each separate combination of servicer and beneficial owner is a separate discussion/negotiation. [/quote]

Bank of America is one of the three largest loan servicers in the country. It deals with many different beneficial owners of the loans it services. The borrowers may only see the name Bank of America, but the beneficial owners are the decision makers (in the cases where options exist).

[hugo]

LPS’ October Mortgage Monitor also cites large “shadow” foreclosure and REO inventories. The number of loans deteriorating further into delinquent status is now more than twice the number of foreclosure starts, indicating another major wave of troubled loans in an already clogged loan pipeline. Nearly one-third of foreclosures remain in pre-sale status after 12 months – twice as many as the year prior. The six-month average deterioration ratio has risen the past two months to 300 percent, showing that for every loan that improves in status, three more deteriorate further.

http://www.lpsvcs.com/NewsRoom/Pages/20091109a.aspx

http://www.lpsvcs.com/NewsRoom/IndustryData/Documents/10-2009%20Mortgage%20Monitor/Exec%20Summary%20for%20October%202009_FINAL.pdf

http://www.lpsvcs.com/NewsRoom/IndustryData/Pages/default.aspx

[hugo]

LPS’ October Mortgage Monitor also cites large “shadow” foreclosure and REO inventories. The number of loans deteriorating further into delinquent status is now more than twice the number of foreclosure starts, indicating another major wave of troubled loans in an already clogged loan pipeline. Nearly one-third of foreclosures remain in pre-sale status after 12 months – twice as many as the year prior. The six-month average deterioration ratio has risen the past two months to 300 percent, showing that for every loan that improves in status, three more deteriorate further.

http://www.lpsvcs.com/NewsRoom/Pages/20091109a.aspx

http://www.lpsvcs.com/NewsRoom/IndustryData/Documents/10-2009%20Mortgage%20Monitor/Exec%20Summary%20for%20October%202009_FINAL.pdf

http://www.lpsvcs.com/NewsRoom/IndustryData/Pages/default.aspx

[hugo]

LPS’ October Mortgage Monitor also cites large “shadow” foreclosure and REO inventories. The number of loans deteriorating further into delinquent status is now more than twice the number of foreclosure starts, indicating another major wave of troubled loans in an already clogged loan pipeline. Nearly one-third of foreclosures remain in pre-sale status after 12 months – twice as many as the year prior. The six-month average deterioration ratio has risen the past two months to 300 percent, showing that for every loan that improves in status, three more deteriorate further.

http://www.lpsvcs.com/NewsRoom/Pages/20091109a.aspx

http://www.lpsvcs.com/NewsRoom/IndustryData/Documents/10-2009%20Mortgage%20Monitor/Exec%20Summary%20for%20October%202009_FINAL.pdf

http://www.lpsvcs.com/NewsRoom/IndustryData/Pages/default.aspx

[hugo]

LPS’ October Mortgage Monitor also cites large “shadow” foreclosure and REO inventories. The number of loans deteriorating further into delinquent status is now more than twice the number of foreclosure starts, indicating another major wave of troubled loans in an already clogged loan pipeline. Nearly one-third of foreclosures remain in pre-sale status after 12 months – twice as many as the year prior. The six-month average deterioration ratio has risen the past two months to 300 percent, showing that for every loan that improves in status, three more deteriorate further.

http://www.lpsvcs.com/NewsRoom/Pages/20091109a.aspx

http://www.lpsvcs.com/NewsRoom/IndustryData/Documents/10-2009%20Mortgage%20Monitor/Exec%20Summary%20for%20October%202009_FINAL.pdf

http://www.lpsvcs.com/NewsRoom/IndustryData/Pages/default.aspx

[hugo]

LPS’ October Mortgage Monitor also cites large “shadow” foreclosure and REO inventories. The number of loans deteriorating further into delinquent status is now more than twice the number of foreclosure starts, indicating another major wave of troubled loans in an already clogged loan pipeline. Nearly one-third of foreclosures remain in pre-sale status after 12 months – twice as many as the year prior. The six-month average deterioration ratio has risen the past two months to 300 percent, showing that for every loan that improves in status, three more deteriorate further.

http://www.lpsvcs.com/NewsRoom/Pages/20091109a.aspx

http://www.lpsvcs.com/NewsRoom/IndustryData/Documents/10-2009%20Mortgage%20Monitor/Exec%20Summary%20for%20October%202009_FINAL.pdf

http://www.lpsvcs.com/NewsRoom/IndustryData/Pages/default.aspx

[Nor-LA-SD-guy]

I think it depends on where you are talking about, in TV for instance I can’t imagine there are a whole lot more left that have not already been turned over (at least in the nicer area’s of TV).

I would add that at current prices around TV (in some area’s at least) there is sometimes more differences in cost of landscaping or lot premium than the difference between top and current market prices between the same model of home in a given tract.

[Nor-LA-SD-guy]

I think it depends on where you are talking about, in TV for instance I can’t imagine there are a whole lot more left that have not already been turned over (at least in the nicer area’s of TV).

I would add that at current prices around TV (in some area’s at least) there is sometimes more differences in cost of landscaping or lot premium than the difference between top and current market prices between the same model of home in a given tract.

[Nor-LA-SD-guy]

I think it depends on where you are talking about, in TV for instance I can’t imagine there are a whole lot more left that have not already been turned over (at least in the nicer area’s of TV).

I would add that at current prices around TV (in some area’s at least) there is sometimes more differences in cost of landscaping or lot premium than the difference between top and current market prices between the same model of home in a given tract.

[Nor-LA-SD-guy]

I think it depends on where you are talking about, in TV for instance I can’t imagine there are a whole lot more left that have not already been turned over (at least in the nicer area’s of TV).

I would add that at current prices around TV (in some area’s at least) there is sometimes more differences in cost of landscaping or lot premium than the difference between top and current market prices between the same model of home in a given tract.

[Author]

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