Bank Owned Foreclosure – A Play on Words?  

It is very common to associate a foreclosure with a bank, and this idea is reinforced when we see advertisements for “bank owned” properties.  Mistakenly, we also believe banks are taking the biggest financial hit when a house is sold as a foreclosure.  However, the fact is that in many cases a foreclosure is not owned by a bank.  If not the bank, then who owns these distressed properties and takes the financial  loss?

Understanding Fannie Mae and Freddie Mac

Fannie Mae (Federal National Mortgage Association) was created in 1938 during the Great Depression by Franklin D. Roosevelt, set up as a government-sponsored enterprise(GSE), and later converted into a publicly traded company in 1968.  Freddie Mac (Federal Home Loan Mortgage Corp.)  was founded in 1970 so Fannie Mae wouldn’t have a monopoly on government-backed mortgages. Their collective purpose is to buy mortgages from savings and loans, banks and lenders to provide cash for more mortgages.  The mortgages purchased by Fannie Mae and Freddie Mac are packaged into mortgage back securities(MBS) through a process called securitization. This process transforms realtively illiquid loans into highly liquid securities.  Therefore, the bank or lender who originates your loan or that services the loan by collecting monthly payment is probably not the entity that owns the note.

While relatively unknown to the general public, the significance of Fannie Mae and Freddie Mac to the mortgage market cannot be underestimated.  Combined they hold approximately $5 trillion of  mortgages, about half of the nation’s home loans. Losses to Fannie Mae and Freddie Mac are expected to approach $400 billion before the foreclosure crisis ends.  The graph to the right from The Cromford Report shows the percentage of distressed sales by city, many of which were owned by Fannie Mae and Freddie Mac.

Who really pays for foreclosures?

On September 7, 2008,  Fannie Mae and Freddie Mac were placed into conservatorship.  The federal government now explicitly guarantees debt issued by Fannie Mae and Freddie Mac.

In a Jan. 2011 article from the Arizona Republic, Anthony Sanders, a former professor of real estate and finance at ASU stated, “Fannie and Freddie losses are passed onto the taxpayers.”

If you want to know if your loan is owned by Fannie Mae or Freddie Mac, click here.  I found out that my loan is owned by Freddie Mac, not the company I mail a check to every month.

The next time you are driving around and see a  HomePath or HomeSteps foreclosure rider on a Phoenix real estate sign, you can be assured that it is a Fannie Mae or Freddie Mac foreclosure, not a bank owned property. Additionally, it is not any bank that is taking the loss but the US government,  and ultimately you and I.

Related Posts:

2012 Real Estate Market Trend

Distressed Property Posts

In search of happily ever after with a Phoenix short sale offer

 Phoenix Waterfront Foreclosures for Sale in Gilbert and Chandler

$264,400 :: 2909 W CURRY Street, Chandler AZ, 85224

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4 beds, 2 baths
Home size: 1,932 sq ft
Lot Size: 8,276 sq ft
Added: 11/16/17, Last Updated: 11/16/17
Property Type: Single Family
MLS Number: 5688581
Community: CARRIAGE LANE 7 LOT 114-239 &a
Tract: CARRIAGE LANE 7 LOT 114-239 &a
Status: Active


Great single story home in the heart of Chandler. Property features a greatlayout with 4 bedrooms, 2 baths and a large kitchen with breakfast bar. Nicesized backyard has an in ground pool. The property is in need of someTLC/updating but could be a real gem with a little work.

Listed with Real Home Services & Solutions


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$225,000 :: 6480 S NASH Way, Chandler AZ, 85249

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2 beds, 2 baths
Home size: 1,387 sq ft
Lot Size: 5,227 sq ft
Added: 07/10/17, Last Updated: 11/15/17
Property Type: Single Family
MLS Number: 5631150
Community: COOPER COMMONS PARCEL 8
Tract: COOPER COMMONS PARCEL 8
Status: Active


Cute home in a highly desirable Chandler Community. Home is a 2 bedroom plus a den. Nice open floor plan. Backyard has an extended Covered Patio

Listed with Revelation Real Estate


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$469,900 :: 3010 E CEDAR Drive, Chandler AZ, 85249

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4 beds, 3.5 baths
Home size: 3,606 sq ft
Lot Size: 17,859 sq ft
Added: 08/24/17, Last Updated: 11/15/17
Property Type: Single Family
MLS Number: 5651016
Community: MESQUITE GROVE ESTATES
Tract: MESQUITE GROVE ESTATES
The price of this listing was last reduced on 10/18/2017 by 5%
Status: Active


Currently still available..HUGE secluded lot, high ceiling foyer with step down entrance, very large game room, RV gate parking, Pebble tech pool and spa, connected 4 car garage, open kitchen / living floor plan. Home is perfect for entertaining, or just taking your vacation right at home.Please READ through the MLS completely. As / IS sale, seller does NOT provide SPDS or CLUE disclosures. Buyer to verify all info herein. Please, DO NOT SUBMIT BLIND OFFERS. Agent of record (not an associate) must register at the ARMLS box to validate the offer. Offers will otherwise be rejected as blind offers. It's usually best to TEXT with your questions. Cash offers must include updated proof of funds. Seller will NOT make repairs of any kind. Please do not adjust the thermost

Listed with Merit Realty


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$430,000 :: 4397 S MARION Place, Chandler AZ, 85249

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4 beds, 3.5 baths
Home size: 3,925 sq ft
Lot Size: 12,632 sq ft
Added: 08/30/17, Last Updated: 11/15/17
Property Type: Single Family
MLS Number: 5653313
Community: SYMPHONY 2
Tract: SYMPHONY 2
The price of this listing was last reduced on 9/9/2017 by 1%
Status: Active


This Home Has It All. Located In The Beautiful Gated Symphony 2 subdivision. Close to all amenities and top ranked Chandler schools This popular Hancock home offers 4bd/3.5ba/3cg with soaring ceilings. Huge kitchen for the gourmet cook in your life with custom tile counter tops and back splash. Master retreat has a 2 way fire place that sets the mood. Secondary bedrooms are very large with walk in closests. Downstairs Nanny's Suite/Guest Bedroom has it's own full bath. The professional expoxied 3 Car Garage with plenty of builtin cabinets for storage, work space and overhead lighting. Home Is Located On A Kid Friendly Street With A Private Park Not Too Far Away. Close to Award winning San Tan K-8 school. Alarm System conveys. Just Too Much To List. Don't wait.

Listed with Prime 220 Realty


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$464,900 :: 391 W WILDHORSE Drive, Chandler AZ, 85286

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7 beds, 4 baths
Home size: 4,685 sq ft
Lot Size: 8,712 sq ft
Added: 08/06/17, Last Updated: 11/15/17
Property Type: Single Family
MLS Number: 5643177
Community: ALMA SCHOOL PLACE
Tract: ALMA SCHOOL PLACE
The price of this listing was last reduced on 10/16/2017 by 3%
Status: Active


PERFECT HOME FOR LARGE FAMILY - 7 BEDROOMS - 4 BATHROOMS AND FINISHED BASEMENT. THIS HOME FEATURES A LARGE KITCHEN WITH ISLAND AND PLENTY OF CABINETS. FAMILY ROOM WITH FIREPLACE, FORMAL LIVING ROOM WITH DINING AREA AND 3 CAR GARAGE. BUYER TO VERIFY ALL INFORMATION AND MEASUREMENTS. BUYER TO VERIFY DURING INSPECTION PERIOD IF PROPERTY IS ON SEWER OR SEPTIC DUE TO BANK OWNED PROPERTY.

Listed with West USA Realty


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$240,000 :: 1700 E COUNTRYWALK Lane, Chandler AZ, 85225

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3 beds, 2 baths
Home size: 1,502 sq ft
Lot Size: 5,227 sq ft
Added: 11/10/17, Last Updated: 11/10/17
Property Type: Single Family
MLS Number: 5686472
Community: PARKSIDE AT THE PROVINCES
Tract: PARKSIDE AT THE PROVINCES
Status: Active


3 Bed, 2 bath home in Parkside at the Provinces, private pool. 2 car garage. Some fix up needed.

Listed with Realty Executives


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$272,800 :: 1806 W SUMMIT Place, Chandler AZ, 85224

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3 beds, 2 baths
Home size: 1,440 sq ft
Lot Size: 7,840 sq ft
Added: 11/03/17, Last Updated: 11/03/17
Property Type: Single Family
MLS Number: 5683167
Community: WOODGLEN UNIT 4 LOT 1-148
Tract: WOODGLEN UNIT 4 LOT 1-148
Status: Active


This is a great single level home in a north Chandler location with no HOA! The 3 bedroom home has BRAND NEW carpet, paint, bathroom vanities, stainless steel appliances, and a new Master Shower! The home has a lot of light colored tile in all the major living areas. The kitchen is bright and open with view towards the expansive family room. The backyard features a pebble play Pool to enjoy the hot AZ summers as well as a good sized grassy area. There is Dobson Ranch Golf Course just 5 minutes away as well as the Western Canal Path that is 3 minutes away where you can run, ride a bike or walk to Tempe to the west and more of Mesa to the east. The 60 and the 101 Freeways are within 10 minutes access from this location. There is great shopping and dining very close by.

Listed with Respect Realty


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$258,000 :: 1028 N Evergreen Street, Chandler AZ, 85225

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4 beds, 2 baths
Home size: 1,887 sq ft
Lot Size: 8,276 sq ft
Added: 07/27/17, Last Updated: 09/14/17
Property Type: Single Family
MLS Number: 5638635
Community: College Park 6
Tract: College Park 6
The price of this listing was last reduced on 7/28/2017 by 0%
Status: Active


Great Chandler location with easy access to freeways for short commutes. Nice size interior lot. Swimming pool. Large covered patio. Screened porch. Living & family rooms. Brick fireplace. Nice kitchen overlooking back & pool. Large master suite with walk-in closet, dressing area, backyard access. Newer roof, HVAC, and water heater. RV gate off alley. Figures/measurements are approximate - buyer to verify.

Listed with Realty West, LLC


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$280,000 :: 4339 E HARRISON Street, Gilbert AZ, 85295

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4 beds, 3 baths
Home size: 2,490 sq ft
Lot Size: 7,405 sq ft
Added: 10/19/17, Last Updated: 11/18/17
Property Type: Single Family
MLS Number: 5676200
Community: ASHLEY HEIGHTS
Tract: ASHLEY HEIGHTS
Status: Active


JUST BACK ON MARKET 11-18-17. Home with pool in Gilbert, upgraded 4 bedroom 3 bath with 2.5 car garage. One bedroom and full bathroom downstairs. Master bedroom with a sitting area and his/hers closets. Vaulted ceiling Situated on a corner lot. Wonderful fenced play pool in backyard. Much more. Needs Remodel Repairs - CASH OFFER PREFERRED.

Listed with Realty Executives


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$248,500 :: 647 E RANCH Road, Gilbert AZ, 85296

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3 beds, 2 baths
Home size: 1,655 sq ft
Lot Size: 6,534 sq ft
Added: 08/30/17, Last Updated: 11/18/17
Property Type: Single Family
MLS Number: 5653694
Community: NEELY FARMS UNIT 4
Tract: NEELY FARMS UNIT 4
The price of this listing was last reduced on 11/17/2017 by 90%
Status: Active


House has great potential in a highlydesired Gilbert community.3 bedroom great room plan with a pool.Pool has been drained and cleaned and is being filled.

Listed with Realty Executives East Valley


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$339,900 :: 1406 N SADDLE Street, Gilbert AZ, 85233

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5 beds, 2.5 baths
Home size: 2,647 sq ft
Lot Size: 6,098 sq ft
Added: 11/16/17, Last Updated: 11/16/17
Property Type: Single Family
MLS Number: 5688734
Community: STONEHENGE - GILBERT
Tract: STONEHENGE - GILBERT
Status: Active


Great home in friendly and prime Gilbert location. This Home has it all 16'Tile, High Vaulted Ceilings in living room and formal dining room. Big family room w/ built in fire place and an open floor plan. Kitchen is very open with large island perfect for entertaining. Home is very inviting with 5 spacious bedrooms. Large backyard and with a pebble tech pool. Backyard is perfect for family gatherings and barbecues. To add to this gorgeous home property is located near the us-60 freeway and is Walking Distance to Restaurants, Shopping & Movie Theaters. Not only is this home perfect for a growing family but property is priced to sell.

Listed with Homesmart


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$309,000 :: 4128 E WALNUT Road, Gilbert AZ, 85298

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3 beds, 3 baths
Home size: 1,945 sq ft
Lot Size: 7,840 sq ft
Added: 06/06/17, Last Updated: 11/15/17
Property Type: Single Family
MLS Number: 5615901
Community: TRILOGY AT POWER RANCH 2
Tract: TRILOGY AT POWER RANCH 2
The price of this listing was last reduced on 9/25/2017 by 3%
Status: Active


Trilogy home with guest casita and private pool. This home has 2 bedrooms plus den and 2 baths in the main house and a bedroom and bath in the guest casita. Some of the many features of this home include 2 fireplaces (one inside, one out), open and bright floor plan, high ceilings, spacious eat-in kitchen with gas cooktop, wall ovens and lots of cabinets, master suite with bay window and french door to patio. The exterior features solar heated pool, full covered patio, room for a spa and BBQ, and an adobe fireplace on front patio between the main house and guest casita. Freshly painted and new carpet. Trilogy is a 55+ active adult community with outstanding ammenities. Come see this one today!

Listed with Realty ONE Group


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$315,000 :: 2971 E Sherri Court, Gilbert AZ, 85296

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5 beds, 2.75 baths
Home size: 2,827 sq ft
Lot Size: 7,840 sq ft
Added: 08/26/17, Last Updated: 11/08/17
Property Type: Single Family
MLS Number: 5652057
Community: Rancho Corona
Tract: Rancho Corona
The price of this listing was last reduced on 10/11/2017 by 4%
Status: Active


An absolute gem in Gilbert, this home boasts amenities galore!!! Located in the Rancho Corona neighborhood with green belts and pocket parks throughout, this lovely large family home brings resort life to the backyard with a pebble-tec play pool, rock waterfall and tons of cool-dec. This open floor plan offers a gourmet kitchen with island, cooktop, built-in microwave and a dream pantry. The master suite is a true retreat with a spacious bedroom, attached sitting/workout room and great dual sink, bathroom with his and her walk-in closets. And kidsno worries, walk-in closets for each of the 3 additional bedrooms as well! And of course, there is shopping, business offices and easy freeway access to malls, restaurants and more.Please verify any information .

Listed with #1 National Real Estate Network LLC


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


Additional information about short sales and bank owned property can be found at Phoenix Waterfront Distressed Property