Wednesday
August 20, 2014

Bulk REO Sales Program Faces More Criticism

|
-A A +A

Bulk REO Sales Program Faces More Criticism

The government’s plans to proceed with a bulk sales program of foreclosure properties is creating an outcry among many in the real estate industry. The latest critic to speak out against the plan—the Florida REALTORS®—says such a program is unnecessary and will harm its state real estate market. 

The National Association of REALTORS®, the California Association of REALTORS®, and other groups have spoken against the Federal Housing Finance Administration’s pilot program to unload its REO inventory through bulk sales to investors. 

"We are disappointed that Fannie Mae and the FHFA fail to understand that this initiative will harm the communities in which it will be implemented and are going forward with this ill-conceived plan," says LeFrancis Arnold, CAR president. "Moreover, not only are Fannie Mae and FHFA moving forward with the plan, they are refusing to disclose any details, such as property locations, final property count, sales price, or names of winning bidders."

NAR has spoken out against an REO bulk sales program. While the bulk program can help alleviate high REO inventories, NAR says that taxpayers would be required to accept larger losses than necessary due to the program. Instead, NAR advocates for individual sales, except in small geographic areas under certain conditions. A bulk, nationwide program would put a large inventory of housing into a small number of investors’ hands and potentially put individual home buyers and sellers at a disadvantage. 

Source: “Florida Group Complains About Federal Bulk Foreclosure Sales,” Orlando Sentinel (Aug. 23, 2012)

Read More

Calif. Lawmakers Try to Stop REO Bulk-Sales Program