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News Link • Housing

Bulldoze: The New Way To Foreclose

Increasingly, it appears banks are turning to demolition teams instead of realtors to rid them of their least valuable repossessed homes. Last month, Bank of American announced plans to demolish 100 foreclosed homes in the Cleveland area. The land is then going to be donated back to the local government authorities. BofA says the recent donations in Cleveland are part of a larger plan to rid itself of its least saleable properties, many of which, according to a company spokesperson, are worth less than $10,000. BofA has already donated 100 homes in Detroit and 150 in Chicago, and may add as many as nine more cities by the end of the year. (LIST: Top 10 Most Affordable Cities for Renters) And BofA is not alone. A number of banks are ramping up their efforts not just to rid themselves of their unwanted homes, but to fully dispose of them. Fannie Mae has a program to sell houses to local municipalities for around a few hundred dollars. Wells Fargo has donated 800 homes to be demolished since 2009. JPMorgan Chase says it was one of the first banks to begin donating houses it couldn't sell, or didn't think were repairable. Since 2008, the JPMorgan has donated or sold at a discount 1,900 houses to city or county officials.

3 Comments in Response to

Comment by Doug Nusbaum
Entered on:

The real reason that this is happening is because absolutely no one wants a free market solution: 

Comment by Robert Bilyeu
Entered on:

Please correct me if I am mistaken, however, it seems that I remember Hank Paulson mentioning something about the American people purchasing these toxic assets through the Government and it also seems that he mentioned something about making a profit on these assets.  The banks may very well have purchased them back as they are very good at purchasing assets which they do not own with money which they do not have.

Comment by Powell Gammill
Entered on:

Doesn't that say sooooooo much about the fascists who rule us?   It is cheaper to destroy value than sell it.

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