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Sacramento Real Estate Writes Letter to All Banks
August 20th, 2007 categories: Foreclosure, Mortgage, Real Estate, Sacramento
Dear Banks, 
The streets are full of your irresponsible lending practices. When checking the MLS this evening and pulling up homes built from 2004 till now in just Sacramento County, there were 182 homes listed as short sales.
This figure doesn’t account for those homes that have already been repossessed and are now owned by the Bank, nor does it account for the homes that you have sold when hiring an auction company. The figure only accounts for today’s actively listed houses that are new and in short sale.
The families that bought these homes bought them in good faith, thinking that they had a place to raise their families and begin wonderful memories. They are not bankers but trusted that no one would give them a loan if they weren’t going to be able to pay for their homes. Boy, have you ever let them down!
Most of these loans were from new home builders who associated themselves with you, as a Bank providing loans. Oh yes, no incentives would be granted on these houses unless the home buyer went through you, the Builders Lender. I wonder if we asked these displaced homeowners if those incentives were worth it…I think NOT!
What baffles me, is why Mr. Banker you won’t re-negotiate these loans… Yes, I know there is no tax write off for you in a short sale which is probably why you are not accepting short sales. But, by the time you’ve kicked the home owner out and repossessed the house, tried to sell it on the Court house steps, unsuccessfully and then placed it in the hands of a Realtor as an REO, you actually don’t get what is owed on the house plus there are countless attorney fees that have been wracked up.
And of course, then there’s the auction companies that you’ve invited to auction off the homes for sometimes far less than what is owed on the loan. How many of these houses do you want to own? How much of a tax write-off do you need? Who is making these decisions? Young whipper snappers with little or no experience? Are they the same people, who made these hideous loans, that are now in a position of authority at the Bank?
It’s time that a little common sense prevail. Not only is this effecting the families that you have destroyed and displaced but it is effecting each of the neighborhoods just like the car wreck pictured above. Is this what you want a neighborhood to look like?
Re-negotiate these loans and let the families remain in their homes…this would be a win,win for everyone. Do the right thing. It’s really very simple. I know families who have tried to sell, knowing that they could not meet the new escalated payment and couldn’t sell, then when they called you, Mr. Bank you wouldn’t refinance because they had been on the market trying to sell. You told them they would need to wait 6 months after having been on MLS in order to refinance. Wake up, yes I’m talking to you Wells Fargo (for one). You gave them crummy loans and if you haven’t noticed prices are going down, not up.
Start trying to help these families and not make it impossible for them.
FYI: If you are a home buyer who is thinking of purchasing a new home from a builder, be extremely careful of those incentives that you are so excited about…they come at a very high price! Many of these homeowners used the Builder’s preferred Lender and now they are losing their homes.
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Amen I want a dozen copies of this to be sent world wide…. I work short sales for realtors all over the country…. I am based in Las Vegas and would like to kick half of these lenders to the curb…. If in their ultimate wisdom they would have lent on 5-7% appreciation (the national average per year)on 100% loans with no pmi they would not be in this situation… The president needs to re-design Fannie and Freddie to accept less than 92% on the first because here in the valley we are down by at least 33% which puts us well below the 28% allowed by current fannie freddie guidelines….. You are so right about wells fargo!!!! Stay in touch and keep fighting for the borrowers who are losing their american dream by the thousands here and around the country…….. AMEN to You!!!!
Donna,
A shout out to you! I have sat back long enough waiting for sensibility but so far have seen NONE! It is time for all of us to write and get the message out to the Banks…perhaps then we might see a change.
Thanks for your support.
Gena:
An awesome letter! In times of emergency, emergency measures need to be taken. I hope the CEO of Wells Fargo reads this.
Hats off to you!
–Roberta Murphy
Gena- Great article.. while homeowners have to take responsibility for umping into these loans the banks must also stand up and take responsibility for some really stupid loans.
Roberta,
I hope you are right and not only Wells Fargo but all the rest of them. I love Real Estate because of the feeling I get helping people realizing their dreams and this part of Real Estate makes me sick. It’s time for all Realtors to stand up and let the Banks know that we aren’t going to put up with it. Stop already!!
Kaye, many of these homeowners don’t and didn’t realize the implications of these loans…they are not in the loan business. Just as I am not a brain surgeon and am not aware of all the ins and outs of surgery. There was a lot of trust in the industry and they have broken that trust. It’s time for them to step and do the right thing and stop this neighborhood wreck that is going on throughout the United States.
What a great read Gena. May I add the travesty of pre-payment penalties! The lenders are acting like carpet baggers (Gone with The wind) and collecting 6 m onths of interest as a penalty to the folks that try and do the respectable thing and sell their home when they realize they are going to fall behind and go into foreclosure.
The lenders deserve the turmoil they are in! To bad it has to hurt the rest of us as well.
Keith, couldn’t agree with you more. These folks are getting hit from all sides. For reason a lot of people think that it’s just those that “shouldn’t have been able to buy in the first place.” And they don’t seem to have any emphathy…it’s also those who have lived in their homes for 35 years that refinanced and got themselves into an adjustable loan that now they can’t afford. And many of them either can’t sell or have no place to go. It’s a very unpleasant picture.
Thank you for writing that letter. My husband and I just lost our home that we owned 24 yrs. My children were raised there and the memories are all we have left. We will be moving out this weekend and I have shed many tears. This leaves us so very humble and now on to new territory for us…. renting. Not easy to rent with a foreclosure on your credit report. This affects everyone and is so extremeley painful and devasting. Luckily we have strong faith in God and feel blessed to have jobs and good health. Prayers for all who are affected because there are many.
Susan, my heart goes out to you and your family. It’s hard to imagine the pain that so many are going through. Although I see people such as yourself each and every day, it always comes as another shock … there are so many. I wish there was an easy answer that could turn this all around.
It will be a very difficult weekend for you and know that extra prayers are coming your way to get you through.
There are better things ahead and it sounds as though you have good faith, God will see you through.
New memories are ahead…gena
What a great post for Sacramento, For Californian for the whole country. Accurate in all the details. And it sounds live the Governor heard it, and shared it with the top lenders… now if the others will just follow.