Foreclosure Home Searches? Maybe some day.

We get the calls routinely, “Can you help us find foreclosure listings?”

More often than not, the questioner means they would like to hear about homes upon which the lender has foreclosed, that are entered into the Triangle MLS when the bank is ready to sell them.  They often are looking for foreclosures in hopes that they can gain more affordable housing around Cary, NC.

I always want to say, “Yes,” and I always catch myself and say, Well, kinda…”

See, there is no provision in our Triangle MLS rules that require a listing agent to identify a home as in the foreclosure process, or as a bank-owned foreclosure, “REO.”

Some try.  Some don’t try.  Some try to obscure the status so they can semi-pocket the listing and get the Buy side commission, I think.

Triangle MLS has taken a recent measure towards clarity.  A “Special Conditions” field will go live on the MLS on November 3, 2009.  And in that “Special Conditions” field, it will be required to indicate if a home is a short sale.   The field also offers listing agents the option to indicate if a home is in the foreclosure process, or if it is already bank-owned. 

Frankly, I don’t get it.  I understand the Short Sale, if the list price is inadequate to cover outstanding liens and pay costs of the transactions.  That is a material fact that will impact the Seller’s ability to convey title.

What I don’t understand is:  Who is served by providing confusion regarding “In Foreclosure Status,” or that fact that a property is an “REO?”  With these two options being, well Optional, we will be in the same circumstance.  Unable to build a search for one of our hottest commodities currently: REO’s.

The intrinsic value in an MLS is the data, and the integrity of the data.  Providing opportunity to obscure data, and to corrupt the integrity of the data diminishes the value of the Listing Service.  It makes that data unreliable.

I’m hoping that this is an incremental change that foreshadows a move by the Triangle MLS directors to at some point make these fields mandatory, so we can search by In Foreclosure Process and REO statuses and gain reliable information.

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