Foreclosures Up 700%
Foreclosures are on the rise. It was really something we all seen coming. With COVID-19 protections in place many practically enjoyed living in their homes for nearly free, without consequence. Now that those protections have ended, the piper is calling. This will be a temporary benefit to the current housing market that has been so hot
that inventory of available homes has been so low that once a home is listed on the market, it’s usually gone in a few hours to a few days at most. Now let’s throw in the the fact that interest rates have already gone up, and the Federal Reserve is contemplating more rate hikes this year. That puts our friends who have an ARM in a precarious situation. In the coming months, I forecast the foreclosure rate will only increase as payments for those in ARMS become unaffordable, and as inflation still continues running rampant, we will see more and more people unable to pay their mortgage due to the costs of everyday living.
How We can help if you are in active foreclosure
If you are on the brink of foreclosure, or the foreclosure process has started, there are several options available we can help you use to stop, rehabilitate, or delay the process long enough for you to find something else. Simply schedule a Free Consultation, and we can help point you in the right direction.
is the hot real estate market cooling?
Yes and No. It depends on where you are at. In some areas of the nation the housing market is indeed slowing down. In others, the housing market is holding steady or even increasing. I am certain that this is, at least for now, dependent upon the economic
policies of the state or local areas. In areas where the cost of living and property tax rates are high, the market is indeed slowing down. If this trend of wild inflation and raising interest rates continue, the housing market nation wide will begin to see this cooling effect. It is my prediction that combined with the current high prices, the current trend of inflation, and the reactionary interest rate hikes, we will see this market cool off. In fact with this cool off and foreclosure rates increasing, I also forecast lenders will begin to become reactionary and tighten up their lending requirements. Mortgage professionals (at least in North Carolina) have enjoyed the flexibility of lending options, even for those with less than perfect credit.
Is A Repeat Of 2008 Coming?
Although there are a lot of differences between 2008 and today, there are also a lot of striking similarities that can be seen as well. Of course, I am only going to focus on the similarities because the differences are quite obvious. In the years leading up to
differences are quite obvious. Prior to the 2008 there was a hot seller’s market, and inflation was starting to take hold. Lenders were underwriting mortgages to riskier clients, and interest rates were at then historic lows. Sound familiar huh? It’s a hot seller’s market now. We all feel the pain with the current inflation, I’ve heard of clients being able to close mortgages with FICO scores as low as 500-550, and although interest rates are creeping back up, they are still relatively low. Although Dodd-Frank had a big role in the crash of 08, it sure didn’t put a stop to predatory lending, especially in the manufactured housing industry, but I will save that one for another article dedicated to just that. Still, many of the elements that played a role on the 2008 are beginning to play out now. Expect the inflation to continue, expect interest rate hikes in an attempt to stave off the inflation. Expect foreclosures to increase. While real estate professionals may enjoy the boost of inventory and closing more deals initially as a result of the foreclosures, this will only be a further sign a crash is indeed coming.
Options for Real estate and mortgage professionals
As the market changes or transitions, so will lenders. You may have enjoyed the flexibility of being able to help your clients get their dream home, even with a less than stellar credit score. Those options may already be getting slimmer. Also, with home prices continuing to climb with inflation, and factoring in the climbing interest rates,
the affordability of buying a home will price many potential clients out of the market. It is and will become imperative to find creative alternatives to help you continue to get your clients into their dream home. One alternative is by improving your client’s credit profile. Of course, a partnership with a good credit repair company can be a powerful asset that will go a long way to helping you get your clients approved, or the best interest rate possible. Credit Wellness Solutions can help your clients get the most out of their credit profile, and help you get your clients into the home of their dreams! Simply register for a portal account where we will keep you up to date on your client’s status, and where you can refer a client to us. We love partnerships, as not only will we work on your clients, we will also send you clients as well. Let’s partner and add a profitable relationship for your business! We will also do your personal credit repair for half price!
