Forclosure Sales Keeping Property Valuations High

Who knows the extent of this, but when banks execute what are called “credit-bid” sales, the total outstanding balance is considered the sale price. The problem comes in when the property has a significantly lower market value. The result is that property valuations in the area are being related to these sorts of “sales,” (which are really just a scheme to keep the banks from having to recognize the loss) are preventing property valuations from falling to a realistic level. Counties have a lot to lose by acting otherwise, since to properly value the properties would be a big hit to their property tax take. Of course this translates to higher taxes. As well as a loophole through which banks game their books to continue to feign solvency.