May 4, 2013

Rising Home Values ~ The Good and Bad

By Timothy Stull (

Unless you have been living under a rock….you have realized that real estate values have been recovering rapidly.  The actual recovery started in Spring 2012 and has picked up a lot of steam.  I really think many home owners were in a state of shock….since prices declined consistently from the Fall of 2006 to Spring 2012…67 months of home value decline….not even the Great Depression yielded that long of decline period.  Around 40% of what was lost due the downturn has recovered quickly….nobody really saw this coming… has taken 15 months to rebound to this level.  Real estate, once the black sheep of the investment pool, is once again the shining star.  Everyone wants to own a home.  The bidding wars are back….lottery pools held in ultra hot markets….cash buyers are pushing short closings.  If you are a current on your mortgage, things are looking pretty bright.  However, if you are currently delinquent or facing foreclosure, the situation could not be much worse.  If you are trying to save your home via loan modification, be ready for the fight of your life.  Banks are getting very aggressive with their collection tactics….digging into assets and income.  The banks know that they can push for the money….remember that real estate has appreciating value & everyone needs a place to live.  “A place to live”  is the operative statement here…..the rental market is extremely weak if you are coming out of foreclosure.  The rental market is tight and good properties go fast….landlords can pick and choose rental applicants.  The banks also know that many people have not made a mortgage payment for multiple years….money was hoarded during the recession…they banks want a piece of it.  Add all of this up and it equals a long and brutal war to achieve a loan modification.  The right defense always creates leverage in any collection matter.  Without proper leverage you are a sitting duck.

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