Re: Working with Loss Mitigation Departments - Posted by Frank Chin
Posted by Frank Chin on August 22, 2006 at 17:54:28:
More and more banks are going thru realtors. There are several reasons for this.
First, if they do it in house, they’ll need people with expertise on the matter, and the work load goes up and down depending on the economy, meaning they may have to hire tons or people at certain times or let them go at others. Using realtors is for the lack of a better term “outsourcing”.
Secondly, having a realtor adds a level of control. Having everything done “in house” may result in “corruption” where employees on the take can approve your short sale package for a cash bribe. If it’s done entirely in house, is bank management going to take “your word” on what the worth is as passed thru your “freind” (with his hands properly greased) at the bank??
There are many things that appeared to be quirks done at banks, where for instance, employees are required to take two week vacations, as a control. A friend of mine always resented this rule till a fellow employee was exposed for embezzlement because the fella had to take the two weeks off, and other employees covering for him discovered the theft.
If all approvals are done at the bank, and you submitted a package saying the FMV of a property is 200K, how hard would it be for the in house banker to tell you, for a 10K cash payment to me, lower it to 175K, and I’ll approve it.
How do I know this??
A friend of my wife’s took over the top job of a finance company, and hired her as the number two. I was curious why two top openings came up at once.
I asked and was told that the previous two guys were arrested, and subsequently jailed for taking cash bribes to approve loans, and taking bribes not to file security doceuments on secured loans. That enables the borrower to secure another secured loan elsewhere with the same collateral.
This came into the open when the borrowers never paid the loans, about several million dollars each, but it turned out the bribed officials at at least a dozen other banks with the same deal, and the affected banks reads like the who’s who of banking. In other words, they used the same collateral to secure loans a dozen times over that they never paid.
BTW, the perpetrators were part of the Banano crime family.
If you were top management at these banks, would you trust these guys working for you making deals?? Scary, heh??