Subscribe to RSSThe Truth About Foreclosures…
Yep, the bulls will tell you we’ve hit rock bottom. But three longs years and millions of foreclosed homes later, there’s still a “potential wave of foreclosures” headed our way, according to Freddie Mac… just as we’ve been warning since the early days of 2007. Truth is, we’re nowhere near the end of a crisis that could cost us $1.5 trillion. Though, there are two very simple ways to profit, which we’ll talk about soon in our newest Option ARM and Foreclosure report headed your way shortly. For now, though, despite reports suggesting the housing crisis is bottoming out – strengthening home prices and few foreclosure auctions – there is no recovery in sight. Government repayment programs and loan modification programs may show improvement, but they’re just delaying the inevitability of troubled homeowners trying desperately to hold on to property that has dropped by tens of thousands of dollars. Another obstacle for the housing recovery is the number of mortgages that are underwater where borrowers owe more than what the house is worth. This negative equity doesn’t qualify those people for refinancing and even prevents them from selling the home, often resulting in “strategic defaults.” But the most devastating of all could be the coming Option ARM (adjustable rate mortgage) resets of 2010 and beyond. It could easily lead to higher unemployment, housing glut, decreased home values, and the death of the cash-strapped consumer. What do you think will happen to housing when the resets happen? What do you think will happen when monthly payments on a $400,000 mortgage jumps from $1,287 to $2,593? We’ll see even more foreclosures, as Option ARM resets cause a larger number of foreclosures than subprime. Higher unemployment will deteriorate any chance of keeping some homeowners from defaulting. Homeowners will find it acceptable to strategically default on house payments, as it’s just easier for them to just walk away. And it could result in another three million could foreclosure this year alone, partially caused because: People couldn’t afford the properties they bought; Jobs were lost… and is only expected to worsen; And others are just walking away because “it’s not best for their finances… ” These “walk aways” or “strategic defaults” have more than doubled from 588,000 from 2007 to 2008, according to reports. And there will be more, as financial “experts” tout the benefits of walking away from mortgages. Does that sound like a recovery in process to you? Unfortunately, j ust as 2007 and 2008 were the years of subprime woes, this one will go down as the year of Option ARM resets. With
Read more from the original source:
The Truth About Foreclosures…
Counter
0 Comments
You can be the first one to leave a comment.