We keep on saying that distressed properties are coming. Well where are these distressed properties? Thirty-seven percent of the homes already owned that Fannie Mae have already foreclosed on, they own them, but they are not yet on the market. How does that break down? Fourteen percent are in the redemption status, when you foreclose on a property the homeowner can have up to a year to come back and redeem that house back. Very few do especially in today’s market but they have the right. So the bank can’t resell that house until the redemption period is over. And thirteen percent of the houses they own the original borrower, the original seller, wouldn’t move out. They are going through an eviction process with that person. Eight percent of them are in a rental property meaning if they took over a house, if they foreclosed on a house and took ownership, and there was a tenant in there with a lease they are letting them live the lease out or it could be part of their rental program that they allowed the borrower to stay in the house for a period of time. They made a deal. And two percent are in an investor program. They are saving them to sell to investors.
Let’s take a look at the first 3 graphs. If we add them together thats 27 and 8, there are 35% that are about to come to market as the redemption period time comes up, that people get evicted, and the rental program, the leasing program, the lease expires. So that is part of the delay in getting them to market. That is why you saw in the previous graph that the number of houses that the bank is actually going to be owning and selling is going up.
Thanks KCM Crew