Foreclosures

The following graphs clearly show that more foreclosures are on the way. Banks are manipulating the release of these foreclosures and this action may give a false sense of market elation. Remember, foreclosures not only deeply impact a family, the sold prices are lower which has a ripple effect throughout the market.

On Friday, I will show you a graph on contract failures which is a direct result of the Dodd-Frank legislation. This legislation seems to have a clear impact on the foreclosure process.

Dodd-Frank was signed into law in July 2010. The graph showing the completed foreclosures had a definite trend until the 3rd Qt of 2010. Then the amazing drop off and leveling off of foreclosures being concluded as foreclosures remain high.

As you may know, a foreclosure affects the credit rating by about 100 to 150 points of the homeowner. A foreclosure remains on your credit report for at least seven years.

You can still buy a house during that period but higher interest rates and higher down payments most likely will be imposed.

Most families will pursue a rental home. The foreclosed home is purchased by an investor which in return rents out the home. Why not just keep the family in their home and have them pay something toward the mortgage until their situation changes for the better. The difference can be tacked on to the end of the mortgage or forgiven by the lender. The loss would be less to the bank, the market would not be impacted and most of all, families are not uprooted and cast aside.

The concept is simple but the implementation is probably impossible due to government regulations!

Wake Up America!!!                        I say it over and over again …………..

As Housing goes so goes the Economy.