I have been preaching about the Shadow Foreclosure Inventory / Zombie Foreclosures for months now. Most folks out there have simply said that I was crazy. I know, the very same fringe handful of folks that also believe it is better to bury their heads in the sand and never confront the Corporate Powers that toss them a bone or two so that they can farm out a Work Order here and there to pay the Title Note they have on their Pinto. By in large, most of the Craigslist Contractors have difficulties figuring out what size of Zig Zag papers they need for the day let alone attempting to grasp economics above numbers like the gram or ounce. So, the concept that financial institutions are refusing to follow through on the legal process of foreclosures is alien to most of them.
Banks are walking away from thousands of vacant properties after starting and then refusing to complete the foreclosure process because they do not want to pay for maintaining the homes.
The result: hundreds of thousands of homes are being withheld from the market, raising questions about whether the recent run-up in housing prices is artificial.
First, I am surprised that Berry was allowed to write this. SourceMedia is an enormous Media Conglomerate which reports upon the financial sector; predominately SourceMedia gobbled up most of the Digital Platforms (Foreclosurepedia aside) and the articles have always seemed to have a positive slant towards the Industry, in my opinion.
That aside, Berry has some pretty hard hitting information. She reminds me a bit of Ben Hallman over at Huffington Post. Hallman is a pretty decent fellow; we had several hours of conversations and numerous emails back and forth with respect to the Industry. Thin skin aside, I think he is a damn good journalist. Back to Berry, though, and what must be a rouge Article which slipped through the cracks. I am truly surprised that her Minders at both American Banker and SourceMedia ever allowed an Article like this out! Berry drills down on a theory I have been stating for over a year now,
Housing experts speculate that banks are purposely refusing to take title of abandoned foreclosures as a strategic move tobetter manage their ballooning portfolios of real-estate owned or REO properties. If more properties were put on the market, it might dampen the nascent housing recovery, the thinking goes.
“I have long been convinced that the current run up in home prices is a false high,” says Ruhi Maker, a senior staff attorney at the nonprofit Empire Justice Center in Rochester, N.Y. “Once all these foreclosures are through the system we could see another decline in prices.”
So, how does this translate to the boots-on-the-ground Contractor? Supply and Demand. Look, the Property Preservation Industry is saturated with two bit Craigslist Crackhead Contractors! Here’s the real question: How many of these fly-by-night Contractors are being let go by the Industry? You know what, you will NEVER FIND OUT! An easy way to identify them, though, is to take a very close look across the Social Media spectrum. Companies legally base hiring and firing upon what a person has posted. You will never find the statistics as to whom the Nationals, Regionals or Otherwise Unspecified Order Mills let go for two reasons: First, they will get the living shit sued out of them. Second, if the Order Mills present statistics; statistics LIKE ANY OTHER LEGAL COMPANY IN THE UNITED STATES ARE REQUIRED TO, they would look like the ignorant colossus that they truly are!
You are able to learn a tremendous amount of intelligence by reading what people write on the internet and viewing the photos they post. Paula Dean, legendary Queen of Southern Cuisine, was let go by Food Network for using the N word after a deposition came to light today. How many folks, right or wrong, have made racial epithets with the presumption that it was common parlance? There is no do over in cyberspace. How many folks have posted a picture of their beer cans, parties, bongs and whatnot? Contractors whom are preoccupied with the alcohol and bikini pictures are precisely the Contractors whom financial institutions and investors will avoid like the plague! Why? Liability! Let’s see here, we have someone whom uses racial slurs, drinks and objectifies females. Yup, sounds like a civil rights discrimination case to me.
While the average Contractor; the ubiquitous Craigslist Contractor, is not impacted by these sophomore mistakes, those aspiring for positions of direct interaction with financial institutions and investors seal their own fate. Even more on point, the tactical minefields Contractors must traverse daily, when on Social Media, become tomorrow’s fodder for opposing entities. Not only fodder against those whom make the mistakes, but also for those whom are seen engaging with them daily.
Supply and Demand. When the Supply of Contractors is at an all time high those hiring them control the playing field. When you couple an Industry overflowing with Contractors and the fact that over 20% of the current Market Inventory is off line due to the financial industry running their Zombie Game, it would be wise for folks to pay particular attention to that which they state in Social Media and the company which they keep.
Truth be known, the Background Checks are the least of anyone’s worries! Right on the heels of the revelations that banks have been doing what I have stated all along, neighborhoods are now lining up to begin the Class Action litigation. It is going to be a horrific mess before it gets any better. Anyone want to guess whom is going to bear the brunt of the bullshit? Not the Craigslist Crackheads, the legitimate Contractors! And it’s not going to stop there. The Nationals, Regionals and Otherwise Unspecified Order Mills are under a constant barrage of litigation dealing with breaking and entering alongside claims of larceny. Throw in some Service Contract Act (SCA) violations and someone has to eat the losses.
At the end of the day the smart Contractors are going to begin migrating out of the cesspool of REO/P&P and get into the direct ventures with the financial institutions and 501 Regulation D investors. Once again, right or wrong, have you considered how your Social Media Resume is going to look like? Now might be the time. As for the Zombies? They are here to stay! 😉