Is Zillow Telling a Story About What’s Really Happening with Foreclosures?

I was determined to take the weekend off after a particularly busy previous couple of weeks. I was interrupted when I received an e-mail from www.Zillow.com, an internet real estate estimation website, sent me an e-mail saying that my former home in St. Louis’ bank owned price had dropped by over $40k.

I started to wonder if Zillow is telling a story about what’s happening with bank owned homes. I decided to dig into my old e-mails from Zillow and post them here. I am not sure this thought process will lead to anything meaningful, but for some reason I feel compelled to explore this. If you see something I’ve missed, or have some ideas about what’s happening here, please post in the comments.

After I bought the Leona house, I signed up for Zillow, claimed the home and uploaded a photo of it. As much as I loved the house, a couple of people have laughed at me for posting a photo of it in the dead of a St. Louis winter, as the grass is totally dead. But you get the idea.

Anyway, here’s the timeline:

On November 9, 2009, CitiMortgage held a trustee’s sale to take the Leona house after the Arizona bankruptcy court allowed them to lift the stay.

Although I’m not certain, as I haven’t bothered to find out what happened, I don’t think anyone bought the house so the bank owns it now.

The first e-mail notification from Zillow is dated March 2010. The REO agent listed the house at $88,000.

5018 Leona St Now Listed for Sale – March 2010 Zillow1

The second e-mail I received from Zillow is dated June 4, 2010, showing a $40,000 drop in price. I’m not a real estate or listing genius, but did the REO agent drop the price because it wasn’t moving? Was it dropped in order to move it? Or because of the comps in the area?

Price Cut on 5018 Leona St – Zillow 2

What’s interesting to me is that Zillow rates the home’s value at $115,000. Does this make sense given the foreclosure mess? Or the comps? Or is something else going on here? The Price History shows a 35% drop in price from 2007 to 2010, and then dropped another 11% on May 7, 2010, and then another 36% drop on May 29, 2010. That means the total price of the house dropped 82%! Then, on June 5, 2010, the listing agent removed the listing.

5018 Leona St, Saint Louis, MO 63116 – Zillow3

Why are the certified funds to be made payable to the listing agent? Is this legal?

5018 Leona St, Saint Louis, MO 63116 – Zillow 4

And here’s another e-mail from Zillow indicating that the property value dropped another $3,000, also received over the weekend.

Zestimate for 5018 Leona St Decreased by 2_7% – Zillow5

Is Zillow telling a story about how the banks have stolen houses from millions of people? This home had a tenant living in it, and who were paying $850 a month for rent, which almost covered the mortgage payment. If CitiMortgage had been acting in the best interest of its investors, they would have modified the mortgage so that I could have kept the home and had a performing loan. I submitted a loan modification package at least five times and they lost the package every single time.

It seems like such a waste, and like millions of you, all I wanted was to modify the loan and would have kept paying on the home. It was not generating cash flow but would have eventually been profitable enough to keep it. But CitiMortgage wanted to foreclose so that it could get its servicing fees out of the deal and so now it’s probably sitting empty while the price keeps dropping by thousands every month.

How is this not fraud upon homeowners and investors? And now they have the audacity to go after the mortgage broker for originating a loan in bad faith?

I have a prediction to make…when the dust settles in a few years and the courts or the government gets done dealing with the attorneys who are unlawfully assisting banks in foreclosing (the stories of the foreclosure mills are unbelievable…proceeding with trustee sales even with a court order telling them not to sell the house! Who’s going to stop them if they disobey a court order? What’s next?), and after the banks collapse because of their greed, everyone who owns a home that was previously foreclosed on is going to have a cloud on the title because these foreclosures were not done lawfully.

You can get title insurance, but what happens when the title insurance companies all go broke from insuring properties with defective titles because the homes were not lawfully foreclosed upon?

Someone recently told me, “Christine, you have to remember, the title company ALWAYS loses.”

What happens then?

DISCLAIMER:

****CHRISTINE SPRINGER IS NOT A LICENSED ATTORNEY. THIS BLOG IS COMPRISED OF HER OPINIONS, OBSERVATIONS AND INTERPRETATIONS AND IS NOT INTENDED TO BE CONSTRUED AS LEGAL ADVICE. PLEASE CONSULT WITH AN ATTORNEY BEFORE RELYING ON OR TAKING ANY ACTION BASED ON THE INFORMATION IN THIS BLOG.****

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