Foreclosure Sales Trickle After Freeze
Written by Yudislaidy Fernandez on December 2, 2010
By Yudislaidy Fernandez
While banks say they’ve ended their foreclosure freeze and are moving cases ahead, more-detailed reviews of documents are slowing the flow of foreclosure sales to a trickle.
Twenty-year broker Iliana Abella, whose firm sells bank-owned properties and works with Bank of America and Wells Fargo, hasn’t seen new cases cross her desk since early October.
"They [the banks] were sending me properties, about five a week. Right before the announcement, it stopped to a stall," she said. "Although, I’ve heard talks that it’s been lifted, I have not received any new assignments since the moratorium announcement."
Ms. Abella said she’s gotten one listing, a property reassigned after a sale was canceled.
Bank of America, GMAC Mortgage, JPMorgan Chase and PNC Financial self-imposed a foreclosure moratorium and all state attorneys general launched investigations to review banks’ handling of foreclosures as concerns rose about use of "robo-signers" for documents.
Since then, these banks have either lifted or announced plans to end the freeze while they continue to review and correct faulty paperwork.
Since almost 60% of Miami-Dade’s home sales in the third quarter were distressed properties, this slowdown could hurt agents who sell bank-owned properties and buyers seeking them at discounts.
Realty veteran Ron Shuffield said 36% of those sales were foreclosures, 23% short sales.
"If this mortgage fallout delays the first basket, this means we have 36% fewer homes to offer for sale," he said. "So if you have the same number of buyers and the supply is going to go down, it probably will create some anxiety in the minds of the buyers who will say "let me wait.’"