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Saturday, June 09, 2007

 

The 'Countercyclical Business' of Foreclosure

Sunday's edition of The New York Times says of a recent house foreclosure auction in Irvine: "All that was missing was the preacher and the tent."

Here's an excerpt:
The company sold more than 265 properties in San Diego, Los Angeles and Riverside during two weekends in May, and it is planning to hold auctions in Sacramento, Modesto, the Bay Area and Atlanta this summer.

Mr. Friedman described his trade as a “countercyclical business,” and he said that the banks unloading the properties preferred not to be identified.

In some cases, he said, the institutions sold the properties for less money than they were owed.

“It’s not a happy occasion,” he said. “They’d rather take a little loss quickly, rather than waiting and seeing.”

However unhappy the occasion may have been for lenders, the auction company put on a driving, shrieking, high-spirited event. All that was missing was the preacher and the tent.

— TJ Sullivan in LA
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