(Update: Clarification on discount.)
Banks offered an average 30% off houses and condos in Orange County in August at foreclosure auctions known as trustee’s sales, reports ForeclosureRadar.com. That’s up from 28% in July and 3% in August 2007.
I should be clear the discount is tied to the mortgage and not necessarily the home’s present market worth. For example, if $500,000 is owed to the bank, an investor could get it for $350,000 (that’s 30% off), but the home’s present value on the market might be more or less.
At trustee’s sales, often at the steps of a courthouse, buyers typically have to pay the full value of the property with cashier’s checks or some equivalent and can only see inside the property beforehand if the owner losing it grants permission.
ForeclosureRadar said banks auctioned off 1,236 homes in August, though usually the properties went back to the bank because no one bid high enough. Weeding out second mortgages or loans on which the company didn’t have complete data, the company said banks offered discounts on 1,048 of 1,166 home loans, or 90%.
On 238 properties, the discount was 50% or more. The average discount of 30% includes properties that were not discounted.
And in related foreclosure topics…
- Distressed homes 43% of O.C. listings
- O.C. folks pay credit cards, skip mortgage payments
- Banks seize record number of O.C. homes
- Time to buy a foreclosure in Surf
- Foreclosure of the week: Walk to the beach
And in other OC Biz news…
- Fresh & Easy workers in O.C. are first to demand union status
- Billionaire sues for $500 million his tax woes
- Sales tax enforcement targets O.C. ZIP codes
- Irvine Co.’s Bren loses $1 billion! Maybe
- Finally, T-Mobile speaks: 3G Internet coming to O.C.
- Readers to Sarah Palin: Keep mum about Botox
- 20 stores, eateries, etc. to open at new Asian O.C. center
Two questions:
“usually the properties went back to the bank because no one bid high enough. ”
What percentage is usually?
“On 238 properties, the discount was 50% or more.”
How many of those moved?
2 questions:
Where do you want to live?
On the exact floor plan, model, how much is it selling for, if it’s listed at all?
That should be the only home you should be worried about!
Lots of questions in this area, but few in responsible positions are answering.
The silence is deafening.
The usual percentage of properties that go back to the bank is 96-98%. See mrmortgage.blogspot.com or foreclosureradar.com’s newsletters over the past several months.
This is the huge “shadow inventory” that isn’t in the MLS inventory numbers you see reported.
At this time only a fool would pay the bank’s asking price on the courthouse steps.
It’s amazing banks don’t try harder to approve short sales which on average has a 20% higher offer price than the post-foreclosure REO sales price. This doesn’t include the 10% cost associated with foreclosures and the 45 day delay between trustees sale and listing.
So this means we’re at the bottom, right? LOL
It’s obvious the banks are holding-out, waiting to see what hand-outs they’re going to get from the feds.
Wow, I thought everyone wanted to live in OC and nothing would happen to home values here. Oh wait, I think the idiots saying that stopped posting months ago. Most people still posting public comments here are at least a little bit realistic these days. It’s true, the situation is much worse, not better, than most of the public data. And you have to do quite a bit of research to get the full picture, not just read a few comments on this blog.