All was going smoothly for landlords and market speculators until the real estate market went bust. Landlords and market speculators had visions of buying homes at low prices and then flipping them for profits. In those years, 2002 to 2006, U.S. economic activity was powered by home building, home buying, the refinancing of real estate purchases, and the desire to fill new homes with the middle-class lifestyle. But since the height of the boom in 2006, home values across the U.S. have fallen dramatically. By the end of 2008, more than 8.3 million homeowners nationwide owed more on their mortgages than their property was worth.
Rocked by declining property values and job loss, we are now facing a mortgage and foreclosure crises. There are still many foreclosures coming onto the market place today. The number of pre-foreclosures in the market are at an all time high. We've by now have heard the words Short Sale. Weather needing a short sale to upload a property, or purchasing a short sale for an investment, short sales are common place. A Short Sale is when a property owner has a mortgage on their property that exceeds the actual value of the home. This is what is called a "up-sidedown" mortgage. This is not a good position to be in because of the recessionary times occurring today.
The Short Sale is the exciting buzzword phase that came into vogue in late 1990 as lenders began to authorize the sale of properties that they had loans on (but had not yet foreclosed on) at a discount. In other words, they allowed the properties to be sold for less than the total loan amounts. Therefore the lenders takes a shortage on his loan proceeds, in order to avoid going into foreclosure. These days it seems like everyone is talking about short sales and either trying to do them or would like to be doing them. It sounds exciting to think about lenders discounting their mortgages and or being able to purchase property below the actual market value. But in realty doing short sales can be a most frustrating, tedious and time consuming way to make a living as a real estate investor. I'm not trying to discourage anyone. You should know that buying, selling or just doing short sales is not an "overnight get rich scheme." It takes lots of work. It is not for the faint of heart, but if you endure you will most likely be successful. And if you are willing to do what most people will not do or don't know how to do, you will have what most people do not.
George Benton:Author
http://www.webrealestatebuyers.com
203-451-4860 or
203-354-3089
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Monday, April 27, 2009
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