Claims of insufficient or even inaccurate documentation filed with foreclosure courts have hit lenders hard. But it’s also taking a toll on real estate practitioners who turned to bank-owned home sales as a strong source of revenue in tough economic times. Now, large portions of their listings have been frozen.
Dealing in real estate-owned sales, or REOs, is different from traditional home sales as agents are typically responsible for rehabilitation and regular upkeep of foreclosed homes, adding financial liabilities that means a payday and reimbursement could take months.
Survival, however, depends on diversification, and a little optimism that the holds on foreclosure listings by the banks won’t last long, and inventory can move again.