Facing Foreclosure, Good or Bad?
One of the states that is facing the most high rates on foreclosure is Colorado where unluckily I live, for better and worse, Colorado real estate steals the spot for being with the most foreclosures. The RealtyTrac, INC report shows that since April, 3706 homes in Colorado were in state of foreclosure. That translates to a ratio of one of every 4954 households in foreclosures. The national average is one of every 1,268 households.
From 2005 to 2006 almost doubled the amount of foreclosures, just in 1 year. This information was collected from Arapahoe County from Public Trustee.
In the total number of foreclosures, Colorado ranked No. 5. Texas, Michigan, Ohio and Georgia had more foreclosures, but they also have far more houses than Colorado.
Some crucial factors that affect foreclosures are:
1) Economy, while other states are doing well, some are not
2) Increase of Interest Rates, today's rates are not the one's that we had 5 / 4 years ago.
3) Unemployment, Medical problems & Divorce.
4) High amount of debts & Bankruptcies, everyday more and more people are becoming victims of big credit companies with their advertising taking them to more debts and so on Bankruptcies.
5) Mortgage Fraud & also Colorado was the one or the only remaining state without Mortgage Broker regulations, an extra for this matter.
6) Over priced homes, some sellers sold houses more than the market value, fraud by some appraisers.
7) programs allowing homes to be purchased with no down payment,
8) Overbuilding
9) Most cases of People that "take out" all the equity.
People, specially investors are more excited to buy properties on these days and then resell them the famous called Fix Ups to get a good amount of profit, some other home buyers want to invest because it is an opportunity for them to acquire a home for less than other real estate property as a good opportunity. For someone can be a loss while for other can be a win.
Some people buy homes that they can not afford. Lenders and Banks won't have second thoughts in taking it back if they can't pay for it.
Consumers need to educate themselves, do not believe about those 1% rates who they offer on the T.V. Radio, newspaper. Those are negative amortization, that means that always get something of your equity to cover the interest that the program it does not cover.
Some other sayings are that such as interest-only loans and the lack of home appreciation, are bigger culpable in rising foreclosures than fraud.
Colorado in some areas the most appreciation is between 3% to 4% yearly, some other areas keep the same value, other areas just depreciate for one of the reasons "high amounts of foreclosures" in that area / subdivision.
There are so many vacant homes on some streets, it is going to change the shape and profile of some neighborhoods for a very long time, It really is a sad situation.
I can tell you that on my neighborhood there are many houses listed for sale at this time and I bet that at least 40% are facing foreclosure, and believe me, I do not live in a bad area, comparables are not as I wish to be. Two days ago, Freddie Mac got one home same model as mine. Can you imagine what will happen with my home on price? It will drop instead of rise, it is just 2 houses besides mine.
Good Luck
Ray Saenz, Realtor
Aurora Colorado Real Estate Aurora Colorado Homes for Sale Colorado Spanish Speaking Real Estate Agent Realtor
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