Foreclosure Bidding – Genuine Homeowners Fail Against Investors in Foreclosure Bidding Wars

April 12, 2011

The collapse of the housing market had given rise to hopes to many aspiring nest builders that they would at last be able to buy an affordable house of their own. But in reality the cash happy investors who have grouped together easily outbid them at the auctions. Thus genuine homeowners are failing against investors in these foreclosure bidding wars. Economists argue that these vulture investors are really helping to clear the market of the mess and putting it back on its feet.

The Director of housing policy for Consumer Federation of America Barry Zigas said that because of this investment frenzy “we’ve seen over and over again a common outcome is investors acquire these properties, put minimal repairs in them and rent them out. There’s been a longstanding history of advocacy to try to get there to be a priority to sell to owner occupants. But it’s a really tough policy to get enacted when financial institutions in our society are faced with trying to recover as much money as they can and move on.” The legislators in Washington like Barney Frank (Democrat) are attempting to give the genuine buyers more power to buy by arranging for bigger FHA loans with decreased down payments in the costly markets like the Bay Area. But nevertheless the ordinary buyer is still at a disadvantage when up against cash happy investors working in groups. Simultaneously Fannie Mae announced couple of weeks previously that when it would put up a foreclosed property in the market it would consider the offers of only “owner occupants and buyers using public funds.

” The offers of investors would be considered only after the first group failed. But the CEO of Stonecrest Financial, Jon Freeman, of San Jose is not willing to wait and watch. He said, “There are huge opportunities out there for those who have cash and guts and foresight. Bulk R.E.O.’s — that’s the new buzzword right now.”  In 2008 the Bank of America had sold Freeman a tidy parcel containing 150 foreclosed units dotted across the low income zone –good number in Richmond, Antioch, Oakland and few in San Jose. In Contra Costa County seat the name of Stonecrest is listed along with the names of small fry investors like Mancheno Enterprizes of Orinda. In Bay Area markets the supply of distressed house both for the sharks and the fry have been falsely suppressed by the lenders that are the owners. Sales were curtailed by government bodies like Fannie Mae and FDIC to raise prices artificially and avoid noting down losses in the books.

Karen Anne, has been working on CheapHomesListings.com studying the foreclosures market, helping buyers on the finer points of foreclosed homes for sale. Try to visit CheapHomesListings.com and search foreclosure homes by state

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Article from articlesbase.com

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