Feb
09
A Short Sale & Loan Modification Video That Should Get Your Blood Boiling
Posted by justin_lee | Posted in Lenders, REO, bank owned properties, real estate investing, short sales, video | Posted on 09-02-2010
If you’re working on a deal with Indy Mac, or you’re curious about lender buyouts and the FDIC really work, watch the short video below:
Feel free to leave a comment, I’d love to know what you think. For me, in a word, I’d describe it as “sickening” (especially knowing how Indy Mac has rejected certain short sale offers)
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This video fails to take into account any of the bad loans that don’t or can’t be short sales that One West bought as well. While in this one situation the bank profited from this situation, saying that the tax payer funded the FDIC is not true. The FDIC gets about 90% of the money it uses to cover loses from fees it imposes to institutions that are members. When they need to borrow money it is borrowed from the treasury and paid back from the fees over time. This is a very one sided video with some inaccurate information and fails to take into consideration a multitude of other factors that happened with that particular take over.
Hi Bob,
Thanks for your feedback. I think that we’d all be naive to think that this video isn’t taking a particular side when it was created.
My big takeaway from this video wasn’t how much “taxpayers” are funding the FDIC, but rather than the lenders are making money hand over fist with short sales, which makes one wonder why they even “reject” so many short sales in the first place. I assume that it’s a deeper accounting issue than we’ll ever know about, but bringing to the public’s attention some of what is going was my goal in posting the video.
I appreciate your commentary,
Justin
What about the money they lose from property they can’t short sale? Or money they lose from things they can’t reposes, and other losses they acquire when taking over an entire financial institutions loan portfolio. In the end a bank is a business, and it’s a businesses goal to make money… if they didn’t think they could make money from taking over the portfolio why would they?
Well according to the video Bob, they AREN’T losing any money….and if they CANNOT do a short sale, they still sell it REO, and the FDIC guarantees 80% of the previous value, NOT the sale price (whether REO or Short Sale).
THIS is the point in the video that I take major issue with these lenders.
It is a pity the video has been removed by the user as I would have loved to have seen it. However, there are some interesting ways to profit from the housing downturn. One in particular is investing in tax deed sales.