Foreclosures & Short Sales

Like it or not, foreclosures and short sales will be a dominant force in the housing market for several years. Primarily at this point, unemployment and under employment are driving the increases NOT "exotic loans". Of course "exotic loans" led in large part to our current recession which led to unemployment skyrocketing...but that's a whole other diatribe!

Many interested homebuyers ask me if there are different guidelines to qualify for a mortgage to buy a foreclosed property or a home by short sale. The good news is...as long as the property is inhabitable getting the loan will be no different than if you were buying from a normal seller (not a bank).


An IMPORTANT thing to be aware of is the length of time it may take from offer to closing...I've had clients wait 4-6 months for an answer on their offer! And that was just the contract THEN we start the loan process and fight to get documents from the sellers. Yes we've closed the deals eventually, but you must be prepared for delays. If you need to move within a certain timeframe then a foreclosure or short sale property is probably NOT a good option for you. However if you have the time (and perhaps most importantly the patience!!!)...then shopping the foreclosure and short sale market could absolutely benefit you financially in the future.

Bring on questions...I could write for days on this topic!

New construction down = GOOD news!

Oftentimes a news story with statistics (CNNMoney's http://money.cnn.com/2009/11/18/real_estate/housing_starts_October/index.htm?section=money_latest) sounds much more doom and gloom than the reality of the data. For example, housing starts (aka new construction) is down 10.6% in October. Sounds bad BUT consider this: the ongoing slow down of new construction  (to about 25% of previous activity) is not necessarily a bad thng long term. There are still too many homes on the market so let's get rid of some of that excess! Once we do the long-term prognosis for the housing market will be much brighter for everyone.