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Come on down! The price was right! A sampling of properties purchased at auctions this week...

It can be a grueling process. It is not for the weak of heart. But for the below 3rd party bidders, the worry and effort paid off. The proverbial wheel spun.

Each of the below properties was purchased by a 3rd party at an auction this week. Although it has its limitations, an estimate from Zillow has been provided for reference.

10309 Circle Drive #103 Oak Lawn  Balance due: $55,088 Zillow estimate: $85,300 Purchase Price: $23,000 Condo

1622 W. Ohio Chicago Balance due: $349,787 Zillow estimate: $254,100 Purchase Price: $139,000 Multi-family

113 Manchester Buffalo Grove Balance due: $308,028 Zillow estimate: $304,100 Purchase Price: $210,000 Townhouse

159 Thornhurst Rd Bollingbrook Balance due: $185,524 Zillow estimate: $132,800 Purchase Price: $46,852 Single Family

1716 W. Farwell Chicago Balance due: $343,585 Zillow estimate: $241,600 Purchase Price: $65,000 Condo

 

These prices would make even Bob Barker proud.

 

 

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You've heard it a million times. Too good to be true... But, you may not have seen this one coming.

We've talked about many ways the foreclosure market has been inflated recently. Most notably, the aftermath of robo-signing oversight. Foreclosures that had been stockpiling with lenders, like Bank of America, while quality control was performed, were recently unfurled.  Now, we are learning of yet another substantial injection into the already swollen foreclosure market. Loan modifications gone bad. Yup! What was meant to help prevent foreclosures has come back to haunt some homeowners. And these loan modifications are introducing themselves in two ways.

For the six month period beginning Dec. 2009, 1.6 million government-backed modifications had been started. Of those, less than 1/2 became permanent. The problem here is that some homeowners or lenders never finalized the process. They may have thought they did. And homeowners are now hearing knocks at their doors that they thought they had avoided.

The 2nd problem is that some modifications actually added money on the back end. Say you were behind 5 months on your $2000/month mortgage. In some instances, that $10,000, plus substantial interest and fees, was tacked on to the principal of your mortgage. Now, if your home was already worth less than the mortgage, this only exasperates the discrepancy. If you still live in a declining market, which many do, think of the ramifications. IF you didn't want to walk away then, you just may reconsider.

Do we need to start embracing skepticism or is there an end in sight?

 

 

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It's raining! Here is a sprinkling of what's happening at the Dupage County Sheriff Sale tomorrow

The below is a list of some of the properties scheduled for the Dupage County, Illinois Sheriff Sale tomorrow. The balance due equals the amount of the outstanding mortgage. However there are usually other fees, such as interest, that have since accrued. Some will start out lower than the balance due and you could get a real steal. Some will be higher. Call us for details to see what happened!

 

6185 Pinewood, Willowbrook

Balance due: $122,850

2180 Rolland, Glendale Heights

Balance due: $152,463

2040 Camden, Hanover Park

Balance due: $267,909

204 W. Roosevelt, Wheaton

Balance due: $210,327

1315 Modaff #4A, Naperville

Balance due: $105,976

1S162 Ardmore, Villa Park

Balance due: $103,085

2220 County Club Drive #15,

Balance due: $88,589

720 Hammerschmidt, Lombard

Balance due: $178,716

 

 

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Purportedly $350 Billion Will Fix It

So, I read with some interest an Op-Ed piece in the New York Times today by Martin S. Feldstein, a professor of economics at Harvard, who was the chairman of the Council of Economic Advisers from 1982 to 1984 under President Ronald Reagan.  He put forth the persuasive argument that the banks and the government should evenly split the difference in the write down of the mortgage from its current level to 110% of market value and then, when modifying the mortgage for the homeowner, make the indebtedness full-recourse to the homeowner so they have skin in the game also.

An interesting perspective on an otherwise tortuous circumstance. If that is all it took, then possibly the cost of TARP makes this seem potentially doable...even if not so desirable.

Here's the article link:

http://www.nytimes.com/2011/10/13/opinion/how-to-stop-the-drop-in-home-values.html?_r=1&hpw

Michael Hobbs

 

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Does $20,000 Make A Difference?

Bank of America announced that it is launching a pilot program to entice delinquent owners to pursue a short sale by offering to pay them between $5,000 and $20,000.  Given that they stand to lose a lot more than that in unearned income, accumulated legal costs and potential property devaluation due to market decline and even vandalism, that seems like a good strategy.  Of course, getting the word out and getting traction are two different things.

What does that mean for the foreclosure market?  On the surface, it is bad news.  Dig a little deeper and it's not likely to have much impact.  While I have not seen the summary of qualifications, my hunch is that they are seeking to compensate those who are 'waiting it out'.  And given that there is no end in sight yet for the bottom of this housing market on a national scale, then averting a few foreclosures isn't going to hurt anyone and possibly it will help Bank of America and a few of those soon-to-be-former homeowners.

Michael Hobbs

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It's A Bird, It's A Plane, No! It's A DistressingBird

Yes, no matter how you slice and dice the numbers, there is still a large concentration of distressed properties out there and more seem to be flying by the week.  Granted, it will soon be the time for the migratory flight of birds from northern climates to southern climates, but unfortunately, the DistressingBird does have wings...it's more like a turkey...in more ways than one.

Wouldn't it be nice if distressed properties could move as fluidly as capital flows in and out of the stock market?  Of if it could move as gracefully as ducks paddling across a lake?  Or move as quickly as seagull nosedives towards the ocean to scoop up its meal and then is off again?

Well, unfortunately for all of us here in Chicago, there is no suck skillset possessed by the Distressingbird.  It's lethargic, out of shape, and generally out of favor.  No wonder that misery loves company.

So, while it is easy to say that it is better to take the high road, it is easier do the path of least resistence.  So, it is unfortunate, but true, that the quantity of distressed properties will rise before it falls.

Michael Hobbs

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The Flood Gates Have Opened

Grab your galoshes! Don your poncho! According to industry leaders and conversations with our clients, the robo-signing oversight is near completion and the auctions are being flooded with new inventory! Many lenders had been making their lists but checking them twice which held up the release of thousands of judgments in Illinois.

The expectations are for the volume to double!

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Lake County Does the Limbo! How low can you go?

Last Thursday, Lake County held it's auction. Last Thursday, according to ILFLS, a leading Illinois foreclosure listing source, fourteen of the 15 winning bids were under $200,000. This includes both 3rd party investors and plaintiff purchases (now REO) properties. Would you buy one of these properties?

1). 10 Phillipa Waukegan, IL 60085

2). 1520 Melrose Ave. Round Lake Beach, IL 60073

3). 37177 Green Bay Road Beach Park, IL 60087

4). 2736 Varonen Ave. Waukegan, IL 60087

5). 552 Woodcrest Drive Mundelein, IL 60060

6). 544 Hillcrest Terrace Round Lake Park, IL 60073

7). 10745 W. Woodland Ave. Beach Park, IL 60087

8). 3317 Stratford Unit A Lake Bluff, IL 60044

9). 1912 5th St. Winthrop Harbor, IL 60096

10). 412 Osage St. Wauconda, IL 60085

11). 1323 Melrose Ave. Round Lake Beach, IL 60073

12). 1808 Gilead Ave. Zion, IL 60099

13). 236 Stewart Ave. Waukegan, IL 60085

14). 1517 E. End St. Round Lake, IL 60073

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