It’s no wonder banks are in such a pickle. Unfortunately, I don’t believe US Bancorp is in financial straits, though they did take $6.6 Billion in TAPR funds.
I’m working a SS (not as the investor, only as the LA Realtor, with a retail buyer’s offer) and we have an offer for $. The 1st mortgage holder has already foreclosed and the sheriff’s sale is scheduled for late December. My HUD shows the 2nd allowed $2,500 for payoff, though that had not been approved by the 1st.
Now US Bank rejects the offer, for a full settlement on their $22K junior lien, yet that offer was for over 10% of what’s due. I know they don’t have to accept the offer, but why wouldn’t they at least say they would release the lien for that, but still reserve their right to a promissory note for the balance?
They rejected it verbally. I asked them to put it in writing; they refused. What’s worse, they refuse to say how much they will accept. Their response, “Well, all we can say is that the offer was rejected and we will hold the file open for 30 days. You’re welcome to resubmit an offer”. :banghead
Our US Government loans US Bancorp $6.6 Billion in TARP funds (actually, I think they made them sell the FED that much in preferred stock, but whatever) … and they don’t even have the decency to counter the offer with an amount that WOULD be acceptable?
Yet, in less than 3 months, the net on their 2nd mortage will be worth zero, zip, nada. (Though they could be entitled to a deficiency judgment, the debtor will likely take bankruptcy and they’ll get nothing). To be entitled to a judgment, however, don’t junior lien holders have to foreclose? I think they may be able to reinstate within 10 days of the auction, but don’t they have to pay off the first to do that? I wish I knew more about this. Anyone able to point me to a resource that explains more about this?).
Anyhow, how I might proceed? Should I try to get the 1st mortgage holder to just tell them they will only allow them $1,000, since the 1st is having to take a discount in excess of $10,000?