Evolution of the Bank Repo

Published by julia | Filed under Buyer / Seller Tips, Market Trends, Miscellaneous, Real Estate

It is a sad fact that many home buyers are having trouble making the monthly house payment. The reasons behind it are many and the options are few.

Why are so many folks facing foreclosure?  There was a time that most foreclosures looked the same.  The condition of the home was not HORRIBLE but rather odd.   Strange and random items were missing.  A few out of place signs of damage jumped out in a house that was otherwise well cared for.  It seemed to be the story of a good citizen who cared for his home getting a bad break and taking out a little of his anger on his way out, as well as maybe taking out his favorite ceiling fan and lighted vanity chest from the master bathroom.  It is also noteworthy to mention that at this time, foreclosures were so few and far between that it was almost a surprise to realize what it was.

Then there was the introduction of the exotic loan.  Buyers purchased big because they were able to get a comfortable payment, for the time being anyway.  They were living large in a home above their means and probably a neighborhood and community beyond over their heads, as well.  They calculated the mortgage payment into their budgets, but not the cost of living of the area.  We also saw a lot of people at this time refinancing pools, snowmobiles, dirt bikes and big screen TVs.  Or buying the same things with the money they saved with their low payments.  When the hard times hit, whether it was the ugly interest rate change, job loss, or other fact of life, the result was the same:  Unmet payments and foreclosure.   These houses showed differently than the first set mentioned here.  On the polite side these houses would be described as “lived in”, with the crayon marked walls, more than averagely stained carpets, evidence of kids, and more than usual small maintenance issues.  The blunt observer would say the house had never been “loved” or “cared for”.   These types of foreclosures became very common.

Today there is no pattern to the foreclosed upon homes.  One cannot predict the condition they will encounter when walking in the door.  Some are so dirty and damaged from neglect, some from intentional abuse.  Yet a few will still present themselves in such good condition that you imagine the seller making a graceful exit from their one life on to another.  Popular opinion is that loose lenders are largely responsible for the decline in our economy and communities.