All Posts Tagged With: "foreclosures"
Don’t get caught in the foreclosure frenzy
Jennifer McClelland | RSS | Fri, Nov 20 2009 | 0 Comments
In this real estate market, you can find yourself thinking that a house is a good deal just because it has been put on the auction block after a foreclosure. While it may seem that you are getting a good deal on a house, there are certain things that you have to keep in mind to keep yourself from getting caught up in the frenzy and getting into a house that you actually don’t want and that you will find yourself resenting in the future.
First and foremost, don’t get caught up in a bidding war for a foreclosure unless you are 100% sure of what that property is worth. Some times a foreclosed property will be completely stripped of anything that is worth ANYTHING in the property such as copper wiring and other fixtures throughout the house. While many of the houses on the market aren’t that dire, it is still important to try to have a contractor or someone else with you who knows how much repairs on the house are going to cost.
In my opinion it is the most important to not get caught up in thinking that you have gotten a deal on a house. In some cases foreclosures are selling for more than houses that are actually “for sale” in neighborhoods just because of the buying frenzy that surrounds the listings.
Ensure that you know what the neighborhood is worth prior to bidding on a home.
Secondly, after you have made the decision to buy a home that has found its way into the foreclosure listings, it is important to make sure that you are approved for a mortgage for whatever your budget is. Having that pre-approval letter will definitely make any offers you make on a home that much more appealing.
Third, remember that the banks that have listed the houses are likely not going to fix them up at all. The bank owned properties are almost always sold “as is” and it takes an act of Congress to get banks to fix things in these houses; they would much rather sell to the next buyer who isn’t requesting that things be fixed in the house.
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Tags: pre approval letter, foreclosures, copper wiring
How a Foreclosure can damage your credit score
Jennifer McClelland | RSS | Mon, Sep 14 2009 | 2 Comments
Foreclosures may be on the decline (finally) in our country, but there are a lot of families out there who may be behind on payments and considering foreclosure as their last option. Like bankruptcy, foreclosure will stay with you and haunt your credit score for seven years.
When your home is foreclosed on, your credit score will drop somewhere between 200 and 300 points. Of course, it can’t drop your score any lower than a 340 (the lowest one can get on his or her credit report), but if you have a good score of 700, you could find yourself with a 400 (which is pretty awful).
Your credit score is more than about just being able to get loans. Your credit score is also the key to lower rates on things like insurance and your future job prospects.
If you do go into foreclosure, you want to make sure that any other credit obligations that you currently have stay up to date and paid. If you’re in good standing with your other debt obligations, then the foreclosure looks like a single item and you can start to rebuild your credit score after just a couple of years.
It is so important to make sure that you know all the implications of going into foreclosure. It is one of the things that should be well thought out instead of made in a hasty decision based on panic. There are also ways to avoid foreclosure if you find yourself looking down that road.
You could attempt to negotiate with your lender. After all, most lenders don’t want to foreclose on your home. In a market that is overflowing with houses for sale, the last thing the bank wants is another foreclosure. If you can give your lender a time frame to catch up on payments, they may actually be willing to work with you.
Sometimes you and your lender can reach a forbearance agreement. This agreement can take effect when you have come into a temporary hardship and the lender agrees to lower your payments until you can get back on your feet. Sometimes the lender will even suspend the payments for a limited amount of time.
As part of talking with your lender, another conclusion you may come to is some sort of loan modification. The lender may be able to lower the payments or, once you are able to pay the full price, start incorporating any late payments into the monthly payment. This would keep you from paying a full mortgage payment as well as any delinquent payments on top every month.
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Tags: ways to avoid foreclosure, forbearance agreement, bankrupt
Foreclosures in the US equal to 1 in 350
Jennifer McClelland | RSS | Fri, Sep 11 2009 | 0 Comments
For the sixth month in a row, foreclosures in the United States topped the 300,000 mark. Last month a total of 358,471 homes were put into foreclosure by either getting a default notice or by being put on the auction block. The figure is up 18% from August 2008, but it is actually down half a percent from July 2009.
This number totals to 1 in about 350 homes getting a foreclosure notice of some kind.
Morris A. Davis, an assistant real-estate professor at the Wisconsin School of Business had this to say about the foreclosure rate, “The foreclosure numbers are largely unemployment related. As long as 15 million Americans are unemployed, record foreclosures will continue.”
Out of all 50 states, Nevada has been hit the worst. With one in every 62 households in the state getting a foreclosure notice of some kind, Nevada had 17,902 foreclosure notices issued in August. That figure is up 8% from July; contrast that against the half a percent decrease for the country overall and you’ll see that Nevada is hurting.
Following Nevada for the worst foreclosure rates in August was Florida. In Florida, one in every 140 homes received a notice. In California it was one in every 144.
In the second quarter 2009, one in 25 homes were in foreclosure according to the Mortgage Bankers Association. That is just over 4% of the homes in the United States.
It is easy to tell when a city or state has been particularly hit hard by the recession, falling home prices, unemployment, and foreclosures; all of which are tied together right now. If you look at the average home price in California and how far the prices have fallen since the beginning of the recession, it is easy to see why most of the homes would end up in foreclosure.
Another problem is the fact that when you take falling home prices and put it together with increasing unemployment. That is a recipe for foreclosure.
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Tags: recession, foreclosures, united states
See where the banks are failing and the foreclosure rate by state
Jennifer McClelland | RSS | Fri, Feb 27 2009 | 4 CommentsCNN.com has a new and interactive-ish map that lets you see the foreclosure rate by state as well as bank failure rates by state. It appears as though the Sunshine State leads the country in foreclosures.
Florida’s foreclosure rate is 7.32% followed by Nevada at 5.58%
http://money.cnn.com/news/storysupplement/economy/bank_failures/index.htm
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Tags: foreclosures, failure rates, foreclosure
Man Builds New Dating Site To Prevent Foreclosure
Jennifer McClelland | RSS | Tue, Feb 17 2009 | 0 CommentsPhoenix – Arizona, one of the hardest hit real estate markets, is also getting hit hard in the job market. With layoffs by the thousands and the highest foreclosure rate in the country, people have to find new ways to generate income outside of their normal day jobs.
Chris Coriale, 36, a software engineer for a small private internet company, owns both a home and a condo in Scottsdale, one of the hardest hit areas in Phoenix. Almost all of the properties on the market are either foreclosures or short sales. Even with renters, the condo costs money out of pocket each month. The only properties that have sold in the last 6 months have been foreclosed, bank owned properties, so even thinking of selling right now is not even a possibility.
Back in November, his company let go 20 people so now the company is struggling to stay afloat. Having the same work load with less people puts more stress and pressure on the remaining people to keep the company going, and to keep it from folding.
The real estate market has been sour for over 2 years now, and that has taken its toll since selling a property that’s not distressed is impossible. In that time, everyone’s adjustable rate mortgages have adjusted raising their monthly payments. Therefore, homeowners that were barely making ends meet before now have monthly expenditures higher than their monthly income.
“Last summer, I had to dip into more than $15,000 of my savings to cover both mortgages while I was trying to rent out condo while it was empty for 4 months”, Coriale said. “The rental market is hit just as hard because the same investors that let their original investments foreclose are now buying distressed properties and undercutting other rentals so that they can fill theirs first”.
With all of the home values under water, it’s becoming more and more difficult to justify spending thousands of dollars per month on a home when your neighbor’s house is empty and on the market for hundreds of thousands less.
In a market with no jobs, no homebuyers, and a possibility of being let go from your current job at any time, people need to find other ways to make ends meet.
Therefore, Chris decided to try to create an online business where he could start building up a member base so that hopefully, the site will start making money in case his day job ends.
It all started as a hobby and a passion to learn something new a few years ago. Mr. Coriale put up a website where he would store his text and picture messages that he didn’t want to delete or lose in case his cell phones broke.
Over the years, the service turned into an email system that would store messages online like email, but also forward the message to the recipient’s phone. This would keep people in touch even without having a smart phone.
Chris saw an opportunity to turn his hobby into an online business. Therefore, he spent the better part of 2008 rebranding the website each night and weekend, and is currently working on marketing the business.
In the hopes of making his online business a success, Chris continues to work his day job, and market his online business at night. It’s a race against time at this point in building his online business and preventing foreclosure.
With the possibility of the Obama stimulus package being approved, things may take a turn for the better, but that most likely will take at least 6 months to a year.
During that time, there could be more layoffs, the renter’s move out, or additional expenses arise, so creating new income streams is essential in times like these. The days of just putting your home up for sale if you couldn’t make ends meet are gone and the corner Home Depot isn’t hiring anymore.
If you’d like more information, or to schedule an interview with Christopher Coriale, please email Chris at cjcoriale@gmail.com.
Related posts:Don’t get caught in the foreclosure frenzy
Tags: hundreds of thousands, foreclosure, distressed properties
