Nearly a decade of economic growth has been evident throughout the United States, but as the most recent wave of market shifts occur, the economy has begun to take a downward spiral. As the backbone of the economy, real estate plays a large role as it affects the employment and housing of many. It has been said that real estate is the last aspect of the economy to be affected. Nearly a year of receding growth in the US economy has made its way into the real estate industry. The years preceding the pandemic saw economic growth comparable to the expansion following the second World War and government relief programs added in response to the pandemic added fuel to the fire.
What goes up must go down and as the United States economy returns to its normal cycle of expansion and recession, many of those invested in the real estate market are beginning to struggle. The seemingly unrelated layoffs of renown companies such as Amazon and Meta will further influence the downward trend in Real Estate. Terminated employees who had planned on purchasing new homes will not do so, as a result less homes will be sold, meaning less real estate agents and contractors will have disposable income to influence the economy. Lack of disposable income creates a trend of living paycheck to paycheck and as this practice sets in, those unable to pay for unforeseen expenses may become the first ones to lose their ability to afford housing, leading to one of the most dreaded scenarios in real estate, foreclosure.
Foreclosures, while not an unusual occurrence, tend to accelerate as the economy recedes. Many Americans that have yet to face foreclosure are unaware of the process and as a result, lack the necessary knowledge to avoid the situation. Unlike a car repo, a housing repo is a bit more complicated and costly. Through the employment of attorneys and other personnel to regain possession of the home, lenders rack up a bill so great that catching up the mortgage is almost impossible. In addition to the legal costs associated with foreclosure, banks also add unpaid interest and taxes to the overall price needed to reinstate. Fortunately, lenders offer an option for those hoping to avoid a foreclosure. Loan modifications occur when the homeowner works out a deal with the lender to reinstate the mortgage on different terms while adding in the bills accrued during the foreclosure process. Unfortunately, those who fail to afford their current mortgage often find it hard to afford a modified version of that mortgage with a greater payment dictated by the bank.
A failing economy is a catch twenty two as its effects are unavoidable once it makes its way into the real estate market. Once foreclosure proceedings begin, avoiding the situation through the means of the lender is nearly impossible, so it is important to find other alternatives to do so. Most homeowners in foreclosure today find that they retain equity in their property. In this case, the amount being foreclosed upon is less than the home’s value and selling the home before the foreclosure date will not only stop the process, it will leave the sellers with a profit they can use for their next home. Some homeowners are not so fortunate as their homes are not worth the amount mortgaged against it, this is either a result of the home’s deteriorating condition or just a failing market. In the case where homeowners are “upside down,” it may seem more dire than foreclosure situations with equity, but there is a solution. Lenders offer short sales for those who owe more than what the property is worth. Contrary to what many believe, the last thing a lender hopes for is a foreclosure. The legal process required for obtaining these properties and liquidating them is a costly process and oftentimes falls short of repayment for the bank. Understanding that something is better than nothing, especially when a foreclosure proceeding is avoided, lenders will entertain short sales. There are even cases where banks allow those short selling their homes relocation funds if there is a need for such. Foreclosures are not the end of the world, as there are many options for those facing this situation and sometimes there’s even profit to be had.
Avoiding a foreclosure is not something homeowners should do alone, the employment of a real estate agent who is a professional in the foreclosure process is necessary as they not only walk sellers through the experience, they work in the seller’s best interest to formulate an advantageous conclusion. At Villamar Real Estate & Investments, we specialize in avoiding foreclosure in all of Florida. Whether you find yourself in Miami Dade County, Broward County,Orange County,Lee County or any other area of Florida; Villamar Real Estate & Investments works with homeowners and banks to ensure the homeowner walks away with the most favorable terms. In addition to obtaining top dollar for those who have equity in their homes, Villamar Real Estate & Investmens employs an in-house short sale negotiator as well as Forclosure versed attorney who is able to obtain approvals from banks to take less than what is owed, allowing us to facilitate a short sale. When the unexpected strikes, it is important to work with someone who is not overwhelmed by the process and will guide you to the best solution. If you or someone you know is experiencing foreclosure, call Villamar Real Estate & Investments and find out how we can make the situation work best for you!