The Real Foreclosure Market

[William Alston]

Something I have noticed for quite some time is that lenders are not being candid about the depth of the crisis and no one in charge is making them accountable for the harm inflicted on each and every one of us.

Before the foreclosure bubble exploded, my network of mortgage/real estate friends were noticing that lenders were not filing/reporting NOD's so as not to impact their reserve requirements negatively, which concealed the extent of the problem from the public for some time.

In some cases borrowers were 8-12 months behind on payments without any action being taken by the lender. This only caused the bubble to grow even more before bursting.

Here is an article that points out how the data from lenders is not to be relied upon without scrutiny from outside the industry. Scrutiny that does not come from those in charge of scrutinizing but instead comes from regular people like you and me.

[http://money.cnn.com/2009/01/21/real_estate/ghost_inventory/index.htm?cnn=yes]

Whether intentionally or negligently concealing the depths of the problem the harm is not lessened by the lenders intent or lack thereof.

Some would argue that they need to be put out of business not bailed out of trouble.

No act of terrorism has been able to do to America what the banking industry is doing to us right now.

We wouldn't think of funding attacks from outsiders that wish to intentionally destroy America, so why do we continue to fund these corporations that are destroying America, even if they are only acting negligently with no intent whatsoever?

This revelation of the true depths of the crisis bodes well for the bulk investor, it gives ammunition to the skilled negotiators out there who are doing short sales and single REO purchases, and it reminds us all that groups like the National Association of Realtors, that had an affirmative duty to protect us all is finding it increasingly difficult to spin their failures.

For more on this duty read the NAR's own words taken from their code,

Under all is the land. Upon its wise utilization and widely allocated ownership depend the survival and growth of free institutions and of our civilization.....Such interests impose obligations beyond those of ordinary commerce. They impose grave social responsibility and a patriotic duty...(Realtors) identify and take steps, through enforcement of this Code of Ethics and by assisting appropriate regulatory bodies, to eliminate practices which may damage the public...

Like destroying the US economy?

And what about the money going to bail out these lenders? If we are seeing, at best, only one third of the ugliness that is already with us, what is the point in bailing out these lenders? How much money will it take before the public cries, STOP!