Bank of America to Start Releasing Foreclosures

InvestorDirector.com

Low priced homes will provide great deals for buyers but may cause falling home values

A top foreclosure insider recently reported to InvestorDirector.com Magazine that Bank of America is going to start to release thousands of homes into the marketplace in August, 2010. This is good news for investors and first time home buyers who have been looking for a great deal on a house. Bank of America is our nation’s largest loan servicer and holds more foreclosed homes than any other bank, since acquiring Countrywide Home Loans in January, 2008. Common problems that buyers have been facing are overpriced homes as the result of current owners owing too much on their homes, and a lack of low priced foreclosed homes to choose from. Michigan is expected to see 8,000 homes hit the market.

For nearly a year, several banks have been intentionally withholding foreclosures from the market. This allows them to command top dollar for every house they sell because it limits the true available supply of houses. For the past year, foreclosed home agents (REO agents) reported to us that they have been assigned just 25% of the amount of homes they would normally see in a month from banks and loan servicing companies in possession of foreclosed home inventory. Because of the slow trickle of foreclosed homes, some agents have seen certain homes fetch as many as 20+ offers from prospective buyers, just hours after hitting the market. Several other top foreclosure agents we’ve spoken to are reporting similar activity in the marketplace. This means that people looking to buy right now are competing for a scarcity of homes and will pay too much in the end. Look for other banks to start releasing their foreclosed inventories after August 2010; though one can never be certain exactly what the banks will do. With an estimated 4 million homeowners to face foreclosure this year, this may only be the beginning of what appears to be a foreclosure bonanza.