Little Secrets about Foreclosures that Could Change Your Life

By Jessie Frost

Foreclosures have been around forever. Only now there just more of them. It seems to be the buzz on the street. Seasoned and novice investors want to invest in foreclosures. In 2004 the number of foreclosures was 2% of the total sales in the US. In the first quarter of 2008 the foreclosures accounted for 30% of the total sales. 

During the 1st quarter 2008 in Stockton California 72% of its sales were in foreclosure. In Las Vegas during the 1st quarter 2008 45% of the properties closed were in foreclosures. So you can see why there is so much interest in foreclosure. 

The reason they are so attractive is if you are going to be successful in real estate, you need to work with a motivated seller. There is no more motivated seller then one whose will lose their property because they are not or cannot make their payments. Typically, foreclosures up to this point were from divorce, medical bills, or unemployment. In addition to these re-occuring reasons, today they are the result of the ARM ( adjustable rate mortgages) being reset from a lower interest rate to a higher rate, making the payment higher and unaffordable to the home owner and their property value dropping leaving no equity. 

What happened to create this situation? People with poor and bad credit were given loans for properties that should not have gotten them in the first place. In CA they were approving people at 22 times their annual earnings instead of the 3 times, which is normal. They were hoping the appreciation would continue and they would get out of the property with a fistful of money and use that for a down payment in a more affordable market. However the market lost its steam and property values dropped and these buyers were left with property that many times was worth less then what they paid for it and when the loan reset they were unable to pay for it. 

Investors also bought homes thinking they could ride the "gravy train" and earn a lot of money and be at the right place at the right time. Many of these people are actually walking away from their homes and have good credit and cannot afford the payment. But they figured why make a payment on a property that is not worth what I paid for it? It might take several years for the property values to comes back, so they let their property go to foreclosure. 

So great opportunity for the investor who knows what they are doing. Every once in a while when the planets align and everything is in sync it's a great time for us to take this opportunity and that is what is going on in real estate today.

About the author:

We offer free 7 day training on buying homes for pennies on the dollar and selling at huge profits. Please visit us at www.forcloseinvesting.com for more details.

Victorville and Wrightwood California Real Estate

National foreclosure rates and President Obama's stimulus plan have intertwined themselves for most home owners still facing uncertain futures in regards to their current home mortgage obligations. Nationwide over two million homes are heading into foreclosure. Barack Obama is considering a number of options to ease the mortgage burden on these home owners. The Obama White house has supported loan modifications based on 32 to 38% of home owner income which aims to drastically reduce the slide into foreclosure for home owners nation wide. A more controversial measure, in the eyes of the financial industry, is a plan to include home mortgage defaults in bankruptcy proceedings. We will have to wait and see how this proposal will work out.

In Victorville, California approximately 60% of the homes on the local High Desert MLS are bank owned. Although Wrightwood California home prices have declined somewhat they still tend to retain their overall value due to their unique mountain location, country life style and ski resort atmosphere. This is due to the high desirability of the Wrightwood's mountain location and to it's close proximity to Southern California employment centers located in the Inland Empire and the High Desert area.

Wrightwood, in addition to its location, is quite fortunate ,anecdotally, having population demographics that show a much higher disposable income consequently averaging lower overall foreclosure rate percentages. Currently there are only 10 bank owned homes out of a total of 73 homes active on the local Wrightwood MLS - (12% of the total). Ultimately you may obtain a lower price, per square foot, for your money in Victorville but Wrightwood homes historically maintain their values at a much higher level over the long run.

In conclusion,  it’s not clear which program President Obama will eventually adopt and how it will effect Wrightwood and surrounding communities located in Southern California's Inland Empire High Desert areas such as Victorville.  

So we will, like home owners everywhere, have to just wait and see.....

Wrightwood California Real Estate

The real estate market for the Southern California mountain community of Wrightwood Calif. peaked in June and July of 2006. Since then Wrightwood Real Estate has seen a continuous downward deterioration of home prices and activity. Although prices remain soft the Wrightwood real estate market activity seems to be experiencing an uptick. In January and February 2008 seven Wrightwood homes were sold. In contrast, in January and February of 2009, 15 homes sold almost doubling that of 2008 for the same period.

It may indicate that Wrightwood mountain home sellers are approaching the price points that are meeting that of the buyers expectations. The main barrier to sell, in these times, seems to be the home lenders. They have shifted to the opposite extreme of the spectrum concerning credit. What we are currently experiencing is well qualified buyers having trouble qualifying for modestly priced loans. Wrightwood's Park Place Realty currently has multiple offers that are in a state of in limbo while anticipating and awaiting bank responses.

With the onset of Spring real estate foot traffic in the mountain town of Wrightwood California seems typical for this time of year. We have noticed numerous local mountain home sellers transitioning their homes into the rental market as opposed to the further lowering of prices due, in part, to the stability and increases in rental prices and overall activity. These are good signs showing that we may be approaching a bottom in terms of real estate prices.

As for the future buyers would do well to take advantage of the current market and price points, while Wrightwood real estate sellers should hang on for the much anticipated turn around which we all have hopes of surfacing in and around 2010.

Wrightwood, CA Real Estate Video

Wrightwood, CA Real Estate Video

Wrightwood Real Estate Video