Why are there so few mortgage modifications?
Because the FDIC has made it a better deal for the banks to just foreclose on properties, rather than allow a short sale or modification.
Bob Hertzog has it here:
So, you ask...Why does this program hurt short sales? Because, our brilliant government offers this SAME PROGRAM FOR FORECLOSURES! The only difference is, the government picks up 80% of the tab on all of the extra costs associated with a foreclosure (BPO's, upkeep, utilities/maintenance, legal fees, etc.)
So, If I'm OneWest, why would I want to waste my time negotiating through a Short Sale, when I can make the same amount of money (if not more) by just letting it go to foreclosure? And we wonder why nobody can get a Loan Modification? Why would OneWest approve a loan modification for this guy, when they can foreclose and make over $100k? And, to add injury to insult, they have held this loan for 6 months! Not a bad ROI, huh?
Your tax dollars at work.. going to the pockets of billionaires like George Soros and Michael Dell who now own OneWest. They need the money much more than you do.
The FDIC, after coming up with brilliant plans like this, is now hemorrhaging funds so badly that they are asking banks to prepay their annual assessments to the fund. You wind up paying for this in higher interest rates on loans, lower interest rates on savings, and higher fees all around.
Bob Hertzog has it here:
So, you ask...Why does this program hurt short sales? Because, our brilliant government offers this SAME PROGRAM FOR FORECLOSURES! The only difference is, the government picks up 80% of the tab on all of the extra costs associated with a foreclosure (BPO's, upkeep, utilities/maintenance, legal fees, etc.)
So, If I'm OneWest, why would I want to waste my time negotiating through a Short Sale, when I can make the same amount of money (if not more) by just letting it go to foreclosure? And we wonder why nobody can get a Loan Modification? Why would OneWest approve a loan modification for this guy, when they can foreclose and make over $100k? And, to add injury to insult, they have held this loan for 6 months! Not a bad ROI, huh?
Your tax dollars at work.. going to the pockets of billionaires like George Soros and Michael Dell who now own OneWest. They need the money much more than you do.
The FDIC, after coming up with brilliant plans like this, is now hemorrhaging funds so badly that they are asking banks to prepay their annual assessments to the fund. You wind up paying for this in higher interest rates on loans, lower interest rates on savings, and higher fees all around.