Hi George, I just reduced a listing of mine in Lakewood to $250,000 today. It will be a short sale and is currently going through the short sale approval with the primary bank and secondary bank (equity line). Check it out and contact me if you want more info:

http://tours4.vht.com/GMI/T1141617/nobranding

ENGLISH COUNTRY SETTING! Storybook charm w/many updates for today's lifestyle! Totally renovated gourmet Kit w/maple cabinetry, concrete counters, beaut. tile flrs, DR w/Dutch door, Bufffet, Wet Bar & Butler's Pantry, LR w/hardwood & cozy fpl. Oversized screen porch will be your sanctuary overlooking the exquisite landscaping compl w/5 gardens. Finished LL w/large Rec Rm & workshop. CC: Subject to court/lender approval. Lake Rights & Rights to 5 beaches voluntary $75 annual membership.
This is a Short Sale - offer to purchase will require 3rd party approval. Home sold "AS-IS".

Linda Zielinski
847-456-3105 Cell

George, The banks have a formula, and most of them are looking to accept 16 to 18 % under market value. That number has to incorporate ALL the fees, closing costs, attorneys fees, commissions, etc..so if the house is listed and commissions need to be paid, the left over amount the bank will be looking for would be about 10% under market value. In this market, I highly doubt there are many homes that will bring a profit to the bank and that includes our own McHenry County. Most banks price their inventory close to what is owed. By us I have been seeing on the average of about 2.5% under asking. Hope this helps!

This is a good question because many home buyers think they can get a special deal on a foreclosed houses today, under the market value. Years ago a bank would foreclose on a home and attempt to collect what was owed. That could be a good deal for a buyer. Today the banks will hire an appraiser and a Realtor to do a complete analysis on the property to see what the market value is. If the market value is higher then what is owed, then the bank will ask for more. Here's my suggestion to you. "EVEN" if the value is for more, it's probably based on the current value. Values are down anyways. Buy Low, Sell High, remember. If you're a buyer, this is a good time to buy!

Every foreclosure is different, depending on the amount owed, (don't forget there are usually attorney fees, second mortgages, etc that you don't know about) . It depends on the bank and their guidelines. Sorry to be so vague, but you have to deal with them on a one to one basis.
Some banks are very easy to deal with, some banks take weeks to answer one phone call.