The bottom will come. I guarantee it. When it does, few will want to buy. In the meantime knife catching is fraught with danger as flippers get washed out one by one.

Wash, Rinse, Repeat

Please consider the following from “MG” who writes:

Mish,

I am familiar with the house at 755 Eames Way in zipcode 02050 because it is just up the road from me. It’s currently in its 3rd foreclosure since January of 2007. The family that purchased it in June of 2005 ($635k 95%LTV) bailed in December of 2006.

A group of realtors came in and bought the home from $544,500 with the intent for a quick flip. That failed and they went into foreclosure.

HSBC sold the home to a local investor for $440K. The investor was able to secure a $417K loan (conforming limit) from First Horizon. Shortly thereafter in early Spring of 2008 the same investor obtained a 2nd loan from Bank of America for $125K and apparently took the money and ran.

The home has been empty since December of 2006. Offers now are sub $200k.

755 Eames Way, Marshfield MA

Judging from the picture, the house does not look too bad. However, inquiring minds are investigating the listing details.

Property in need of work. Owner planning on repairing water damage to floors & ceilings prior to sale. This is a short sale and offers are subject to third party approval. Lots of potential to be restored to a beautiful, spacious home with great amenities. Circular drive and mature plantings. Pool in back yard in need of repair. Bring all offers!

Well the offers are in. They are under $200K according to”MG”.

Here’s the deal ….

Banks selling to unqualified and undercapitalized flippers is still not such a hot idea. In case banks have not noticed, home prices are still falling.

The math is rather simple: Bottom Seekers + Neglect = Repetitive Foreclosures.

Mike “Mish” Shedlock
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