Foreclosures: Not Just Subprime Anymore
As I’ve noted before, although the economy seems to be stabilizing a little bit, the REO market continues to grow by leaps and bounds.
Foreclosures that were being postponed due to waiting on the new President’s plans for dealing with delinquent mortgages are now being processed – but there’s a huge backlog to deal with.
On top of that, there’s a whole new wave of foreclosures about to hit the mortgage industry. And these don’t involve the risky subprime mortgages you’ve heard so much about. These are more mainstream mortgages. The problem now for many American families is, with all the downsizing, bankruptcies and layoffs, unemployment has nearly doubled. Not only that, but many workers have lost overtime pay and been reduced from fulltime to part-time work by the businesses they work for.
And that’s resulting in many more families unable to keep up with their home payments that were on fairly economic ground before. Economy.com estimates that 60% of mortgage defaults this year will be a result of joblessness.
That means more REO listings on the market. And the good news there is that more and more home buyers are interested in buying REO homes.
Values have gone low enough where first time home buyers are now seeing REO properties as affordable and a good investment, as I write about in my article, “REO LISTINGS: MORE PROPERTIES GENERATING MORE SALES.” As I also indicate in that article, the problem is that these new buyers are worried about the whole process of buying REO homes – mostly the hidden costs that might be involved in buying foreclosures.
I believe REO Sellers, brokers and agents all need to work together to educate the public about the REO buying process so that they won’t have these doubts about whether REO purchases are safe. I encourage all the ASREOS members to work towards this end and for everyone in the REO business to be as professional as possible.
A lot of this trepidation comes from the actual physical condition of REO homes. That’s why we can’t ignore the importance of completing proper Property Preservation services on these houses to make sure the buyer is happy with the look of the property. It’s another reason why we started REO RESQ™, the first nationwide franchise of Property Preservation professionals. By training our franchisees in the specifics of securing, repairing and maintaining REO homes, we ensure that standards are kept and the homes are “market-ready.” Please feel free to check out our new website at www.REORESQ.com for more on our services.
And don’t forget to participate in our exclusive members-only forum on www.ASREOS.com, as well as taking advantage of all our other great REO resources. This REO boom will be with us for a few years, so let’s make the most of it. By doing our best to sell REO properties, we help stabilize the housing market in general and aid in America’s economic recovery.
