Under-valuing of repossessd houses/flatsgreenspun.com : LUSENET : Repossession : One Thread
I've spent days now looking at all the Q&As, and would appreciate comments on the following observations. Lenders have no particular incentive to market a repossessed property at a fair price because of the Mortgage Indemnity Guarantees they made us buy (under false pretences). When surveyors go to do a valuation on a repossessd house they are very likely to know that it is a repossession, and they then tend to undervalue it. The fact that lenders have been churning these cheap repossessed properties onto the market has had the effect that *they*, the lenders, have been artificially and blithely depressing the market price in some areas (eg parts of north of England). Any thoughts please? And how does knowing this help us? Eleanor.
-- Eleanor Scott (firstname.lastname@example.org), July 07, 2000
Basically once the property has been repossessed the lender couldn't give two hoots what they get for it as long as they get something - I'm surprised they don't just give them away. Speaking from experience my partner had his property valued prior to the repo and Northern Rock refused to agree to a sale saying that the price was too low (there was a couple of thousand shortfall) which we asked if we could turn into a personal loan) This was refused. When THEY sold the property they sold it for B#9,000. They say that this was in line with the valuation. Interestly they used the same Estate Agency that my parter used for the earlier valuation - with substantial differences. The property price had decreased by the same valuer by twelve thousand pounds within several months. However Northern Rock feel that all of this was "fair" and that they obtained the marketable price for the property. Basically it seems that the lenders can and will do what ever they like what ever the consequences. It seems like if joe public conned somebody he'd go to prison the lenders don't even get the wrists slapped - WHY?
Look forward to hearing your comments
-- Jo (email@example.com), October 25, 2000.
This practice doesn't just affect the North. I live in the South West and when our house was repossessed in '91 we had it on the market for B#69k, after repossession the Lenders sold the house with the same Estate Agents for B#46k. Their answer to this was the slump! The funny thing is that the difference in price was B#23k and they are chasing us for B#27k! Amazing isn't it?
-- jacky jones (firstname.lastname@example.org), October 26, 2000.
Don't you just wonder how they work out the maths? I think that they just pick a number and then add a few zeros and hey presto they chase for the shortfall. Its also strange how they expect you to pay the amount they say say you owe without question but they don't think that it's reasonable to provide a breakdown or summary of how they came to their calculations.
-- Jo (email@example.com), October 26, 2000.
Hello Eleanor,I may be out of date on the date I quote but I understand that Bldg.Societies are required by the B.Soc.Act of 1986 to'obtain the best price reasonably available'.Obviously this 'best price' can be the best in a bouyant market - and reason suggests that it should be a fair, realistic and healthy price because of the very conditions that exists i.e. plenty of buyers.Or,it can the 'best of a bad job'in a depressed market. Now, we all know that the appointed Est. Agents in these cases all seem to have a totally different understanding of the English language in these instances and invariably sell way below the 'best price reasonably.....(I,m quite sure that many of these 'agents' or their friends/relatives/ business associates have benefitted from buying properties at these deliberately depressed prices. May they rot! What I cannot understand is why the nudge, nudge approach is seen to be so acceptable. It is not - it is theft. I would suggest that you ask a reliable friend or associate to approach the agents as if they are potential buyers of your property and make sure they obtain the details of the surveyor who valued the property for the Bldg. Soc'y. Also, they should express interest in another property,similar in as many ways poss.particularly price, that has not been repossessed. THEY should then obtain in writing from the agent the reason for the difference in price. Obtain as much info. as poss.regarding the marketing of your property. i.e. where, when, how, who by? Scour the archives of the local newspaper that the agent usually uses for advertising to see what , if any, activity has taken place - even if it is only a notice saying that 'an offer for £xxxxx has been received and further offers should be made by.......'. Gather as much relevant info. as you can Eleanor - it then gives you ammunition to use. I cannot say how VERY,VERY STRONGLY I feel about this blatant robbery that is going on.IT IS ABSOLUTELY DISGUSTINGLY CORRUPT. The lenders know full well and care less about this common practice and consequently do not deserve an ounce of respect. I personally am about to pick up the cudgels, after several years, further to info. I have gathered from this marvellous site. I would not recommend anyone using the B.Soc. Ombudsman - he told me a lie - so don't waste your time or emotions. I'll be in touch again - if you wish to e-mail me direct, please do so. Good luck and take care. JOY.
-- Joy Harker (firstname.lastname@example.org), February 10, 2001.
I think you are right, but I wonder how we can use the information. It's easy as counting 123 to find repossessed properties at an Estate Agent. Black Horse Agencies sold my property some years ago, and undervalued it by some 20K compared to local sales and the re-mortgage valuation done less than a year before. The Estate Agents actually told me, to my face, that they were instructed by my Lender to "get anything they could" and shift it. Best price possible my rear end. The valuation tables on those sites posted here on the HRP even show how much of a discrepancy there was (Nationwide, Upmystreet etc)Those tables showed the average in a given area, but factor in the more popular roads and neighbourhoods in a town and schools etc..you have an even bigger red flag waving about undervaluation. Take the vultures who post on here asking where they can find repossessed houses - where do they get the idea of a bargain to be had if it's not an actual fact?
-- Too scared to say (email@example.com), February 10, 2001.
Hi iwasduped !
With regard to the Hina s of this world I have suggested a place where he might look for a property. (Have a look at my reply to Hina's letter.)
When we all(collectively) have more indisputable EVIDENCE of under- valued sales we can then do what we are allowed to to do legally to stop what THEY are NOT ALLOWED to do legally.
-- Joy Harker (firstname.lastname@example.org), March 12, 2001.