The video below makes me angry. However, it explains a lot of things that happen in my world. I get so frustrated when banks do things that seem completely counterintuitive. I’ve had numerous short sales go in bizarre directions because of bank regulations. In one of them, the bank came back and demanded that the purchaser pay LESS for the home (that is not a typo). On numerous occasions, banks have turned down offers from qualified buyers and then taken substantially less just a few weeks later. The most memorable of these occurred last year when a client offered $2,200,000 for a home and was turned down flat. The bank then approved $1,000,500 just a couple of months later.
The most frustrating part of this whole situation is the reluctance on the part of the bank to offer assistance to homeowners who truly desire to stay in their homes. I have clients who have short sold their homes for prices at which they could have afforded to remain. One in particular couldn’t sustain the mortgage on a $1.1M home and had to short sell. The home sold for $680,000 (which they could afford). The bank could have saved a lot of money if they had just written down the principal. Go figure.
Get ready to cringe when you watch this. Our hard-earned tax money at work…
