What we have occuring in the Real Estate Market at present is paramount to a Black Hole in space. The Event Horizon is the point at which the gravitational pull of a black hole will consume everything in its path including light. The implosion of the Secondary Mortgage Market, created a ripple effect throughout the Real Estate World and lead to the creation of a Black hole.
The foreclosure rate has increased 36% in August. Over 100% from the preceding year. A Black Hole. Sucking in properties, banks, mortgage lenders, realtors and everything else in its path. The law of physics is basically simple- it states that every action has a reaction. An implosion within the banking industry, and subsequent collapse of the secondary mortgage market (Sub-Prime) and set into motion the ripple effect.
What is occuring now, is a result of what happened "long ago and far away" When the Real Estate Market erupted blowing properties sky high in terms of price, the ripple across the Lending Universe had just begun.
What is occuring now is the strengthening gravitational pull. As loans become more difficult to get, the Fed's slow response to the catastrophic implosion, and resulting fall out, the black hole of Real Estate has widened.
Foreclosures are feeding the black hole whose appetite is insatiable.
So how do we stop it? The Fed has to make loans more affordable. The black hole of bank foreclosures needs to be slowed to a trickle before it consumes the economy. Professionals have to work smarter and harder.
Owners in jeopardy of losing their homes must maintain contact with the lender.
Seek alternative financing options.
Realtors need to:
Pre-Screen customers and clear obstacles to close deals.
Sellers have to price realistically.
Buyers have to realize they cannot make unrealistic offers.
Working together it is possible to resist the gravitational pull the market is currently experiencing.
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