Most of my clients come to my office after months even years of trying to work with the banks, to no avail. Most of my clients already have long notes and records of their attempts to qualify for a modification or some other relief and after they retain me I require that they keep an accurate and detailed log of all communications with the lender. I want the judges to see just how hard my clients are working to try and solve the problem….I want the judges to understand how the lenders are gaming the system.
I’m convinced that most of our judges get it…they see the games being played by the lenders, and they’re growing frustrated by the unwillingness of lenders to work with honest homeowners who want to maintain their home, and who want to continue making a monthly payment. I hear the stories about the foreclosure rocket dockets in other areas of the state, but as I’ve sat through several here in Pinellas County, I see our senior judges taking the time to listen to both sides and pushing for real settlement whenever possible. I am very hopeful that the new mediation program implemented in this circuit by Mediation Managers, Inc. will produce real successes, because it will force lenders to come to the table with real world solutions.
Our judges are overwhelmed. This problem has been dumped in their laps and they’ve not been given the resources necessary to deal effectively with the problem. The recent funding by the legislature is a start, but it’s not going to solve the problem. If every single pending foreclosure case were granted tomorrow, the lenders would be stuck with the homes and immense incredible expense in caring for these homes. They’re not going to be purchased by end users because 25% of Americans now have credit scores less than 600, so they couldn’t even qualify for the subprime mortgages that got us into this whole mess. (See story in Wall Street Journal here.)
The foreclosure auctions are going to increase and it won’t be too long before the lenders will be begging for them to slow down…..the nuclear bomb hidden in all these foreclosures and sales are the property taxes and municipal liens that will be owed on all these properties…I wonder how the lenders intend to deal with that very big issue….
The list attached here shows that there were 1,146 foreclosure auctions in Pinellas County July 1, 2010 – August 1, 2010. I haven’t compiled the exact numbers, but my overview shows that the vast majority of these sales were either canceled, reset or the home went back to the bank. Have a look for yourself at each day’s sales by clicking here. There are very few third party sales at all. Who knows how many of these sales have judgments that have problems with them, but my anecdotal experience suggests that the foreclosure mills have been very sloppy with their title work and judgments, so many of these properties will be lingering around as problems in the years to come. Take a look at the foreclosure sales docket and consider what it means that all these properties are either going back to the banks…the foreclosure auctions are going to mushroom exponentially in the next several months and I guess we’ll get the answer to the question I’ve been raising for months…
WHAT WILL THE BANKS DO WITH ALL THE HOMES ONCE THEY GET THEM BACK?
The bottom line is we’re stuck in the middle of a terrifying economic mess. There really are very few hopeful economic indicators and I see nothing in the immediate future that holds any promise of a solution. The personal owed by homeowners and the national debt owed by our country is simply staggering. Simple sixth grade economics leads any rational person to the conclusion that we’re all in real big trouble here….and that’s not going to change until we see dramatic changes in unemployment and our larger economic structure….two areas that are not at all easy to change.