mike32716
Member
- Joined
- Jan 23, 2003
- Professional Status
- Certified Residential Appraiser
- State
- Florida
The OP is in Texas. I'm not sure how long it takes there to foreclose, but the client is generally looking down the road to the time that they will get the property back, and market it. What is implied in the their question is if the property will lose systemic value by then, and how much (declining values). They will have a better idea of the loss timing they will book, and/or can then make a decision to pay the owner to get out early so they can dump the property quickly.
I worked with many asset managers during the bust, and they were always trying to project what the house would be worth down the road (massive foreclosure backlog in Florida). There were multiple decisions from buy out the borrower (usually promise not to seek a judgement), to holding and renting, to just letting them live there for free in the hope that the market would turn around (and spreading out loss recognition over many years). Heady days.
I worked with many asset managers during the bust, and they were always trying to project what the house would be worth down the road (massive foreclosure backlog in Florida). There were multiple decisions from buy out the borrower (usually promise not to seek a judgement), to holding and renting, to just letting them live there for free in the hope that the market would turn around (and spreading out loss recognition over many years). Heady days.