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Banks: Their Own Worst Enemy

I had a buyer in February that wrote an offer on a house that was in the process of foreclosure.  The seller had bought it for $230,000 a couple years back and left it 75% of the way into a rehab.  It had been on the market for several months but was finally priced reduced to $160,000.  At that price it was a good deal so several buyers submitted offers.  Because of the multiple offer situation, my buyer offered $163,000.  We waited 45 days to get a ‘no’ from the bank and they repossessed the house.  That was April 2, 2007.

On August 29, 2007 the bank put the house back on the market… 5 months later!  Guess what price they put it on?  $160,000.

So here’s the bank with an offer in February for $3,000 more than they’re asking in September.  I understand that banks are overwhelmed with the number of foreclosures coming in but if they don’t get their act together they’re going to find themselves in even more trouble than they’re in already.

Message to banks: get a clue…….. and quick!

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It's also amazing that they don't put any effort into preserving the look of the exterior. Many of the BO properties have in ground sprinklers yet they are never allowed to run. For not much money the banks could have someone perform very vary basic maintenance like watering and probably sell the homes much faster because they don't look abandoned.


It's funny that banks would force themselves to own and maintain properties instead of allowing a short sale, making the seller take the difference as income, and writing off the loss. It should be interesting to see this all unfold over the next year or two. Nobody wants to hold onto depreciating equity, but when it comes down to it, the banks own the houses and will have to maintain them.


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This website is a service of Aaron Dickinson of Edina Realty, a broker Participant of the Regional Multiple Listing Service of Minnesota, Inc.