Repossessions For Sale
Buying a car and not respecting the monthly payment dates can turn out very painful for the debtor as laws in some states and the initial loan contract that has been signed may stipulate that the bank or the creditor is entitled to repossess the good or the property for the acquiring of which the loan was made. In this case what the whole business will turn down to are repossessions for sale.
When it comes to a car, the bank may choose to sell it at a public auction or not. If the good is of some kind of use to the creditor, then it may not be sold at all. But if it comes to property or to a house, most likely they will become repossessions for sale because the creditor needs to recover its financial losses fast. Usually the auctions are for the public and they are of real interest for investors because these repossessions for sale are very good investments. Sometimes the price of a house or property can go down as much as 30 or 50 percent from the real value, all to serve the interest of the bank’s desire for fast recovery. Therefore repossessions for sale have become the target of many real estate investors that want to make easy and fast money.
Because more and more people find it easy to obtain a loan from the bank while guaranteeing with their home or property, it so happens that more and more people end up with loans in default. It is like a spinning wheel and our society hardly realizes that the ones at the bottom and in trouble nurture the flourishing of the others through making these loans and going into default. This means that they are unable to continue paying for their mortgage and as a result the bank becomes the new owner of their property or good they guaranteed with. Because of this fast growing number of debtors in trouble, the repossessions for sale have led to the “repossessions auction rush”, as some call it, much like we used to have the gold rush in the nineteenth century.
What’s worse, while others get to benefit from this, the debtor may end up even worse than losing his property. If the bank files suit for deficiency judgment and wins, the credit consumer will wish he had never made that mortgage. The deficiency judgment is the difference between the money it got at the auction and the overall amount of money it actually needs to recuperate from the debtor. And who shall it recuperate it from but from the credit consumer? While somebody enjoys a very cheap rewarding property, somebody else loses it and has to produce more money to cover losses of a creditor.