One of the most frustrating aspects of steps buying is the continual (seemingly perpetual) postponements of target properties. It seems that there’s no rhyme or reason behind some of these postponements. One house I’ve been tracking has been abandoned by a deeply underwater homeowner. The appliances and fixtures have been stripped out and there’s no way the owner is attempting to salvage his position in the property … yet Bank America won’t put a bid on the house … 4 postponements and counting. My theory is that Bank America made stupid high loans on this property and they’ll have to put a low bid (far below debt on the 1st) to attract investors. Even if they choose to own it as an REO they will need to drop the price far below where they are carrying the loan on their books. Hence, for accounting reasons, Bank America would prefer to kick the can down the road and not put an opening bid on this property (postpone it again). Any other theories as to why a lender would continually postpone sale of an obvious “lost cause” house?
This is a GREAT question and one that many investors and homeowners are asking. Sean O’Toole wrote a fabulous blog about this called Foreclosure Roulette, A Game of Extend and Pretend http://www.foreclosuretruth.com/blog/sean/foreclosure-roulette/
This will undoubtedly help you understand why this is happening but unfortunately there is no answer to your question on whether your deal will be a lost cause.
Thanks Michelle … very helpful info/insight provided by Sean in that blog post. Today’s news from Bank America re sloppy processing of foreclosures (blind sign-offs by overwhelmed, understaffed and poorly supervised staff) may also be a factor in the latest extend (now suspend?) and pretend “activity” … or lack thereof