Friday, December 04, 2009

When will Banks Finally Start Foreclosing?

I wonder when banks will start to foreclosure on homeowners?

I  know five home-owners here in the San Fernando Valley who haven't made a single payment to their mortgage companies for the past 15 months and are still living in the home - payment free.  No payment, no taxes, no HOA fee!  Who doesn't like a free ride at the expense of others? How is this possible? 

Thanks to the government and all the money they threw at the banks, banks are in no hurry to recoup the governements their losses.  It's gotten so crazy that Bank of America is returning the governments money because they don't like the restictions being imposed on them.

Read this story about how Bank of America is returning the government's $45 billion.

Nonetheless, I believe there are so many home-owners in default that if the banks moved quickly to foreclosure, home-price would plummet to 1995 levels.  How about a 3 bedroom, 2 bath home for sale in Sherman Oaks for $250,000?  Down from a high of $800,000 just a few years ago.  It definitely would have been a reality if the government and politics did not step in.

Who wouldn't walk away?  What level-headed person would continue to pay for a home-loan who's value has fallen drastically and in which the purchase-price may never happen even after 15 years.  I wouldn't!!!

Richard Johnston
RE/MAX Grand Central

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