Just when all the news services say the average home price is leveled off, the economy is doing better jobs reports don't show the proof.
It was not that long ago the 5 major banks make a deal with the federal government on "robo-signing" and held back on foreclosures, as I mentioned in another post, when everyone was so happy to see a slight decline in foreclosures. That was the "Phantom" surge where a myth was perpetuated to make consumers feel good that the economy was getting better.
One of the leading mortgage process servicing companies says business jumped 28% in February. Although you may think because of the decline of about 47% in foreclosures in 2011 this can't be true tighten your belt here are some hidden facts not being reported on your television yet.
Deutsche Bank has started this year up 47% over 2011, Wells Fargo has risen 68% and good ole Bank of America including BAC Home Loans has jumped 7 times it's estimated foreclosure rate for 2011 in the same months. None of the lending institutions have responded to questions or numbers according to the investigative reporter from Reuters.
The housing experts are saying the warning signs of a new wave of foreclosures can be expected across the United States. This may be good for investors but certainly isn't good for homeowners, communities or families. Putting value into homes and neighborhoods was the foundation of our economy. Take away the home and you take a major chunk out of the economy.
Another report shows the number of homes with three generations living together is up significantly. This is no surprise based on the foreclosure rate and our economy. More of my clients have grown children living with them now than ever before. The side benefit is they are becoming families again instead of separate lives with little inner activity.
RealtyTrac showed a slight drop in foreclosures from January to February nationwide but 21 states jumped with some cities like Tampa up 64%, Chicago 43% and Miami 53%. The change in foreclosure profiled now is not the toxic mortgages or the high interest rate mortgages. It is affecting American's who had always been able to meet their obligations. People that maintain their credit with pride of ownership.
Zillow reported that expect a 3.7 drop in home prices on average this year because of excess bank inventory and it may be 2013 before we see the bottom. Amherst Securities doesn't report much better numbers. They think we have some 9.5 million families that may lose their homes to foreclosure.
Changes are also in the wind for Fannie and Freddie with regard to modification guidelines for existing homeowners. The benchmark on how much is owed is changing. If your debt exceeds a certain percentage you may not qualify for a modification loan that you could have gotten last year.
Real estate agents that understand the market will be able to help sell some of these homes. Others that have listed properties without the right price will find their listings still for sale many months past the seller's expectations.
What are your thoughts? Complete article by Reuters