GMAC mortgage company is shutting down its retail operations, offices, loan officers et al. In our office we have a GMAC representative who was given the news today. He will have a space till October and then they are closed. I believe they have been in business since 1982 and were in the top 10 of mortgage originators. One by one the market is dissolving the players who can't continue to fund in a profitable manner.
This is trying times, the worst since the great depression. Although, I believe we will turn the corner after the election the field is full of broken dreams. Less players and a need for the government to assist in new good loans. The past is the past, those loans are clearing the books with record foreclosures. In many parts of the country foreclosures comprise over 40-45% of the sales. This will eventually end. The property and mortgages in question are mainly the sales in 2005 area and later. Most areas report about a 30% drop in pricing from the highs. That would not wipe out most properties bought in 2004 and earlier in most areas.
At some point we will clear the books of bad debt. When this happens we can begin a new. Lets hope this time another financial genius doesn' t come up with a plan to innovate the industry with great ideas of prosperity for all.
Richard
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