As you may or may not have heard there is a new Foreclosure freeze currently in effect in 23 states in the US.  Bank of America, JP Morgan Chase and GMAC, have put EVERYTHING on a freeze while they investigate "paperwork issues."  Apparently, many of the purchase contracts used by these Banks have been auto-signed by the Asset Managers that essentially act as the Seller. 

This is obviously not a good thing as it may lead to a new wave of Lawsuits brought on by those that were negatively impacted by the negligence of these Asset Managers and other Bank employees. 

You should also know that if you are currently negotiating on a Foreclosure property and it is owned by any of the three Banks above they are not going to review your offer until the freeze is lifted.  I have an Investor client that just put in two good cash offers on Foreclosures yesterday (different Banks) and the Listing Agent for one of the properties owned by GMAC said she would hold my offer until the freeze was lifted and then present it.  Not only does my Buyer have to wait around for an indefinite period of time there is also a huge potential for another Buyer to come to the table and make another offer creating a multiple-offer situation.  How?  BECAUSE BANKS ARE NOT WITHDRAWING THE PROPERTY FROM THE MARKET WHILE THIS "FREEZE" IS IN EFFECT.

I think that is wrong.  How can you have a home actively listed for sale but not be able to negotiate an offer?  In my opinion, these properties should be temporarily withdrawn from the market.  This tactic of piling up offers to present to the Bank frustrates anyone looking to purchase property as an investment because they are also competing against those that are willing to pay retail and move in rather than flip it or rent it.

Keep a close eye on this situation as it develops.  I have a feeling there is more going on than just "paperwork issues."

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