Where do the banks drop off their keys?
January 30th, 2008 | by mbhunter |The picturesque foreclosure involves a homeowner in arrears walking to the bank to drop off the keys, waving good-bye to their house and their credit rating. Now the banks are trying to drop off the keys for homes in various stages of repossession from these borrowers — vacant homes that are falling into disrepair, attracting unsavory attention, and becoming liabilities for the neighborhoods that contain them. The banks all have their finger on their nose and are saying “Not it!” but some courts are beginning to take the lenders to task, saying “Uh, we’re not playing that game!” Big lenders and other players are being fined for code violations unless they maintain their properties or otherwise dispose of them so that they don’t become more of a liability on the surrounding properties..
This is a new twist. Banks were taking it on the chin for some of their BOAs, but I would have thought they would get rid of them a lot faster than they apparently have been. Holding out for a decent buyer is reasonable, but broken windows around for any length of time take their toll on the neighborhoods, which gets the city’s attention. For areas affected by this kind of downturn really aggressive bargaining with banks might work. It’s true that investors would be buying problems, but at the right price, just about any problem is worth buying. It will be a fun time for folks who can afford to buy.
4 Responses to “Where do the banks drop off their keys?”
By Ron@TheWisdomJournal on Jan 30, 2008 | Reply
Maybe the banks should consider leasing the properties back to the former homeowners for a reduced rate. It would cut their insurance rate, help keep the home in good condition, and be a friendly way to increase their positive exposure in the community. People understand that the bank wants its money, but by keeping people in a home, even for a short period of time, would have some positive benefits in my opinion.
By Daytona Beach Florida Real Estate on Jan 30, 2008 | Reply
This might be a great idea for right home buyer/tennent. We had a house go to foreclosure and the whole block cheered. They never mowed the yard for years and always had the police there and family sqwabbles and thats not what this street has ever been about. The people never worked and as there children told us do this move house to house however they can get by.
But with the right person it could be a great idea. Couldn’t they offer then some sort of lease to own also. They could assess the house at today value not during the boom several years ago and still make a small profit.
By Bad Credit Loan on Jan 31, 2008 | Reply
I am sure a financial institution will come up with the answer to the question and obviously make millions. But what will that company be?
By Jayson on Feb 9, 2008 | Reply
Thanks for pointing this out - I’ve never thought about the maintenance and cost of maintenance that the banks incur. I felt bad for them loosing tons of money on foreclosures and having to market the properties but never realized that they’d also have to take care of the properties.
Just one more reason why short sales are so attractive for banks.