REO business?

Is it me or has the continuing extension of this moratorium essentially killed REO? I don't see any legitimate REO business coming back realistically until spring 2022....Any thoughts? 

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  • I have had 2 legitimate foreclosures in the last month since March 2020.
    Any others after March 2020 were either deed in lieu or reverse mortgages.(and very very few).
    I am with John in believing REO business will trickle through more in the 2-3 quarter 2022.
  • Keystone just merged with LRES
    • Not surprised to see this type of consolidation.
  • I did a REO sale this year but property was foreclosed on 4+ years ago and had been sitting vacant for that time. Been seeing a few that I did BPOs on in years past. Seems that whatever is left over from 2008-2010 downturn are finally being unloaded in this market, which is very good here in New England you can easily sell before the bank actually starts the process.

    Courts here in Mass are back open but with a back log. Money is starting to flow in from government programs to pay back rent on a lot of people who owe their landlord.

    Also here in Mass, legislature is looking at court and foreclosure reform. Lots of complaints about foreclosure process, from illegal auto doc singing to being able to find out who owns the mortgage.

    Also saw that several BPO companies are selling or just closing up for good.
  • That is the earliest .... The qty will be small. I think Jesse also stated it.
    • Sam, I thought of you the other day while reading an article on the eviction situation. I had thought that this fall would be the time when the flood gates opened. This article points to early 2022. The article points out that with all the rental relief money not spent that many facing evictions will find judges that will give them more time. I know that in my market a normal eviction process has a 90 day grace period for the tenant or occupant of the property. Looking more and more like the winter before we see more activity. Lost over 90% of my business this year alone as did many others here.
      • As you know, I am in one of the highest housing cost areas(SFBA). With many high techs moved to SF City, small investors bought lots of properties and rented out. The monthly rent was often low 5 figures. With the pandemic, companies allowed workers to work at home or anywhere in the US. Tech workers many left SFBA. Since early 2020 rent had dropped -30%. Then the remaining renters many stopping paying rent while staying virtually for free since early 2020. I know two rental properties were sold with the tenants not showing. One was a 4- plex. Many tenants in SF were small businessmen figured the government will take care of their failing business. Pay rent, utilities. Many renters now bought new cars. A few claim that they are saving for the down payment for a home. Small investors, apts owners may be on the chopping block. One church elder estimated non-rent affects 30% of rental housings. Also, San Bernadino County, CA is also flooded with landlords in trouble.
        May be 4-5% landlords have heard from State that they are getting their overdue reimbursement. Most are 20-30K. Our governor who promised to pay 100% rent back is on the chopping block in a few days so he is making a lot of promises.
  • REO business is dead right now.
  • Spring of 2022 is optimistic in my opinion. We need to keep in mind, President Biden was part of the Obama Administration who killed off REO in the name of home preservation. By introducing leasebacks and pushing REOs into long-term rental strategies vs. listing them and selling them Biden has a blueprint to follow to avoid any ugly political fallout from evicting homeowners in an election cycle. So, maybe I'm crazy but, I think REO is going to be slow for sometime to come.
    • Agree
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