As the real estate market continues its recovery with rising prices and lowering foreclosure filings, it is difficult to ignore the impact of the last few years. A recent report found that foreclosures in 2012 resulted in a loss of $192.6 billion for American homeowners, a number that averages to about $1,700 per household for 114.7 million households nationwhide.
Short sales with homeowners behind on their mortgage payments saw a growth of over 22 percent compared to last year’s figures for the three-month period ending September 30th as reported by RealtyTrac. In addition, short sales for people who were up-to-date with their mortgage payments also increased by 17 percent.
It is an unfortunately common scenario. First-time auctioneers or those inexperienced with the process buy out an HOA foreclosure, not knowing that a much larger bank foreclosure is looming over the property. Quite often, the banks will not hesitate to foreclose on the new owners in a startlingly short amount of time.
As an additional sign to recent information that the home market is improving, it is now easier to obtain a mortgage than it has been for quite some time.
According to a survey of bank lending standards conducted by the Federal Reserve, commercial banks have loosened restrictions on residential property loans in the second quarter in an effort to meet increased demand.
To be precise, just over 50 percent of bank officers that took part in the survey stated that they saw increased need for home mortgage loans in the second quarter, eclipsing the 30 percent mark set for the first quarter.
With mortgage rates dropping for the sixth week in a row, including a record low average of 3.67 percent on 30-year plans, as well as perceived expectations for an increase in home values in the immediate future, Americans are much more open to purchasing homes at this time.
Short sales were at a record three-year high this past quarter, with a growth of 25 percent over the last year. The Associated Press reported that short sales “make up the vast majority of homes sold while still in the foreclosure process.”