Many real estate insiders are predicting another major foreclosure flood to start flowing soon. The government and major banks associated with foreclosure abuse have now settled, which was a major holdup on these banks taking significant action on their loan borrowers who became delinquent. Now that action will start ramping up.
According to the Mortgage Bankers Association, there are roughly 4.8 million borrowers currently behind on their mortgage payments, now at risk of foreclosure action. Add to that, the RealtyTrac statistic that says almost an entire third of all 45 million home loans currently outstanding (roughly 12.5), are underwater, owing more than their property is worth.
What do these two factors mean to the real estate market?
Finding expert opinion in agreement is difficult at best. Many tout a stabilization in the market, referring to a slow but steady increase in existing home sales and high number of loan modifications at low interest rates. They believe the market is in recovery mode and will only continue to improve.
Others, especially those that deal directly with the foreclosure market, are anticipating a new foreclosure flood to hit hard in the coming year. They watched as the foreclosure action taken by the big banks subsided while they battled the government over abuses. And now they are watching for another flood of foreclosures to hit markets across the U.S. threatening to challenge current property values once again.
The good news? As long as current mortgage interest rates hold at their historic lows… buyers may well see the best yet real estate deals coming available soon. There’s no question now is primetime to purchase property, as these mortgage rates and property prices remain so low. But for those buyers not quite ready to purchase, or for those investors continuing to add to their portfolios, chances are the opportunities will continue to surface for a while longer.
Insider tip: real estate websites available to the public like Realtor.com and Trulia.com carry information imported from the MLS. However, that information can be days and weeks old in many situations. If you are serious about buying property, use the services of a real estate agent. They can easily set up an auto-search for you on the MLS (most up-to-date accurate information) and you’ll be among the very first to see what matches your pricing, area, size criteria given. The advantage? Be the first to see the newest and possibly best deals in town, have the most current information automatically emailed to you each morning, and be on top of your buying competition. Then you and your agent can run out to view the property and jump on the great deal if it’s the right one for you.