How to fix unemployment and foreclosures at the same time

Dear President Elect Obama, America’s banking leaders, and Lou Dobbs. Here's an idea that will put a serious dent into both the unemployment rate and the foreclosure crisis simultaneously.

While the nation's banks are receiving billions of dollars of bailout money with no real accountability, this might be an intelligent way to channel those funds into something that will actually help solve serious problems. As a real estate professional, I can tell you unequivocally, and my 1.3 million Realtor colleagues will corroborate this, the bank foreclosure process is seriously screwed up. The procedures and policies that banks use to process a short sale, foreclosure, or bank owned property sale are completely inefficient, ineffective, antiquated, and are costing the banks (and therefore taxpayers) millions upon millions of dollars. If you’ve ever been victim of a foreclosure or tried to buy or sell a foreclosure property, you know that it will take many agonizing months to process, sometimes up to a year, with little or no communication from the bank, and may or may not result in a positive outcome for the bank, the buyer, the seller, or the nation.

Here's the problem in a nut shell. The bank needs to analyze the value of the subject property and the potential buyer's offer to determine whether they should take a loss on the foreclosed mortgage or how much of a loss is reasonable to take. But the bank and its employees are usually out of state and have little data, connections, or realistic knowledge of the local real estate market in question. The bank passes documents from person to person and department to department, all in the name of risk reduction, when in truth, all of these people have very limited knowledge or accountability for the actual deal. This creates enormous inefficiencies and bad decision making. What a shock! So with a better system, the banks could process foreclosure deals faster, saving millions, and make better decisions, saving even more millions. For example, when a good Realtor handles a transaction for a client, they handle the entire deal from beginning to end, with informed knowledge of all the details and can advise their clients about the best decisions to make along the way.

So here's the solution. Unemployment is over 7% and hundreds of thousands of people with excellent accounting, finance, mortgage, and real estate experience are out of work. Hire these experienced, knowledgeable, and mature people to oversee the foreclosure processes at the banks. But the key is this, assign one experienced, knowledgeable person to each deal, who can analyze and assess the situation quickly, negotiate the deal if necessary, and make an intelligent decision on behalf of the bank. Doesn’t it make more sense to pay one experienced person to follow a deal through successful conclusion and positive outcome, rather than 17 low-paid staffers, who will take more time and accept no responsibility for poor decisions? Everybody wins!!!! The bank, the buyer, the home owner, the unemployment rate goes down, foreclosures reduce faster, and the nation's real estate market will recover faster!

Of course, the devil is in the details, but the current system is inefficient, sloppy, and just plain stupid. If anyone in the white house or a major banking institution would like more details on how this plan can save America, I would be happy to answer questions and provide a strategic plan.

Sincerely,
Chip Bruss