From the desk of George M. Akerley
Harbingers of Spring...
Foreclosures are up. The Home & Real Estate section of The Hartford Courant dated Sunday, March 2, contained 86 foreclosure sale ads. A week earlier, in the February 24 edition, there were 69 such ads.
Borrowers expect reduced prices along with seller concessions on just about every piece of real estate they view. Sellers are adamant that their property has not declined in value; therefore, a price reduction is not in the cards.
The CT Families foreclosure-prevention and homeowner assistance program introduced by Governor Rell in December has been roundly criticized for its failure to reach more troubled borrowers.
Interest rates have been as volatile as ever, fluctuating wildly day after day. After hitting a low of 4.875% a month or so ago, the offering rate at CHFA today is 5.75% (and rising?).
USA Today reported this week that consumers now are more likely to pay their credit cards, auto loans, etc. before making their mortgage payments. The article goes on to say "some people have essentially given up trying to stay current with their mortgages and instead are focused on using credit cards to squeak by."
Is there any good news? I happen to think so.
There is plenty of pent-up demand here. First time homebuyers are still first time homebuyers. I know that sounds simplistic, but the truth of the matter is that there is still a large segment of our population that has never owned a home, and the desire is still there. Unfortunately, what we have seen in the not-so-distant past was a marketplace flooded with gimmicky products that many of the lenders didn't even understand. It is time for education and it is time to treat our databases as real, live people instead of databases.
Those of us still in the mortgage and real estate industries are the survivors. There are many who have dropped out, and undoubtedly more will do so, as well. What that means for the rest of us is, of course, more potential clients knocking on our doors. But it also means that the public will come to expect a professionalism from us that will be based on pure motives and will provide sound advice.
Our phones are ringing with more and more people desiring to know what to do and how to do it. If we take the time to explain and increase the knowledge of the callers, we will all prosper. Interest rates, though higher in recent days than earlier this year, remain affordable for most. There has been a definite "pushback" by mortgage insurance companies, as well as Fannie Mae and Freddie Mac; largely owing to the losses suffered in 2007 and continuing today. And, of course, we have an ever-dwindling supply of mortgage lenders. We are still in a marketplace that has taken a beating from the "mortgage crisis" and the "implosion" of so many lenders. But we have not given up hope; nor can we afford to do so.
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