Chances are, like most people, you understand foreclosures only from the point of view of the resident in danger of loss. The fact is that foreclosures are, like all things, issues that involve more than one point of view. To better understand foreclosures, it is important to know where the different parties are located in the field.

To review, for the struggling resident, a foreclosure means the loss of your home. This is inconvenient, to say the least, and can be highly problematic given the psychological investment we put into our homes. Aside from the immediate loss, the foreclosure process is humiliating and can damage one’s financial reputation. A foreclosure for the evicted resident is a total loss with no immediate redemption aspects.

For the bank or credit institution to which the property technically belongs, a foreclosure is usually not a profit, as we might think. The house has already been paid off by the lender, so they are simply taking custody of something they already own, so it doesn’t add to their assets as such.

It may be a loss because the foreclosure means the full expected amount will not be paid; although depending on how many payments have been completed, the bank may break even or win financially. However, there are costs to foreclosures, such as taxes and fees, as well as payments to the personnel involved. For lenders, foreclosures should be avoided, but not as bad as losses.

For the repo men, a foreclosure is just another job. They do not enjoy forcibly evicting residents and taking their property. They are often subject to all kinds of abuse by the residents of the houses slated for repossession. However, contrary to popular belief, most foreclosures are completed relatively peacefully.

The repo men themselves want to avoid hostile or violent confrontations because there is the added risk of injury, property damage, and damage to their reputation as citizens. It’s just a job that could be better if the evictees would cooperate and act civilly.

For speculative investors, foreclosures are potential gold mines. Some see them as vultures that feed and profit from the losses of others, but it is a business opportunity. Foreclosed properties generally tend to sell for less than market value because banks are eager to get rid of this “bad” asset and recoup losses.

For speculative real estate investors, the goal is to buy foreclosed properties and sell them at a profit.

For neighbors, a foreclosure on someone’s home can be treated with indifference, sadness, or a degree of dark joy, depending on the evictee’s relationship with the neighbors. However, a large number of foreclosures in one area can degrade the real estate value of properties there. From a financial standpoint, when many foreclosures occur in an area, area residents lose some of the value of their property, at least until someone else buys the foreclosed property.

From the government’s point of view, foreclosures are undesirable because they generate public dissatisfaction and reflect economic instability or policy failures. Subsequently, these may cause a loss of reliability in terms of the value of the investment, and investors may start to avoid the country (or state or other smaller area).

In general, while a certain number of foreclosures are acceptable and almost expected, national and local government units want to prevent many foreclosures.