Posts Tagged ‘michigan’

In investigation of Michigan foreclosures for sale, there are listing services providing the potential investor with the most up to date information pertaining to properties that have been foreclosed on, or are about to be foreclosed on. The origin of this kind of service stems from those who conducted courthouse research for title search companies or attorneys. These listings were used by professionals in the industry and from this it was determined that there was a need for this information. Courthouse research companies have since expanded their services and are able to make this data available to consumers in the form of investors, and other bargain seekers in the property market.

Organizations that deliver accurate information in the form of Michigan foreclosures for sale listing services, fully understand the foreclosure process. They know the kind of information required by their customers and the opportunities that are available.

It is advisable to ensure that any listing service used has a good reputation, there are some services listing Michigan foreclosures for sale who pay very little attention to detail, do the least amount of research and make false claims. It is very possible to become financially independent by investing in real estate, however not in the way that some listing services suggest. Beware of telemarketers who make statements that appear too good to be true, they usually are.

The realities are that the real estate industry is not what it was a few years ago. The economy is in an upswing, and Michigan foreclosures for sale on the books of bank are no longer so prolific. Banks and Government owned properties are no longer being given away at a song. Bank owned Michigan foreclosures for sale are still available but these days lenders are often selling properties at more market related prices and making a profit on them. There are however opportunities available to investors who are willing to learn the process of buying and selling foreclosure properties.

Some incredibly absurd claims have been made by Michigan foreclosures for sale listing companies, here are just two of these absurdities:

* All foreclosure properties on our listing sells for 60% discount on market value. Bank owned properties sell for market price or at discounted values, the average discount on REO properties is less than with any other method of investing in real estate. For instance buy in pre-foreclosure and at auction, if the investor knows what they are doing, makes more profit.
* Our listing company is networked with more than 4 000 banks. There is no national network of banks or lenders who list their real estate assets, and at last count, nothing like 4 000 banks. If this were the case all foreclosure listings would be identical. Every listing service contains different foreclosures for sale and these are generally regional.

It is for these reasons that the investor needs to ensure they are in possession of a reliable Michigan foreclosures for sale listing service.

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Foreclosures have a close relationship with the purse of the average American. This is the issue being raised by candidates and something that every one wants to know. Inflation is at its worst since the last 17 years. Unemployment is soaring and foreclosures are galloping on.

To many these are just numbers and figures read over breakfast prior to rushing off to work. Mortgage dues continue to be paid while gas and food bills are denting into the income. This will mean a dinner or two will be skipped. But taking all things into account the American of today is better than what he or she suffered during the last recession that came to a close towards the end of 2001.

But that is only side of the picture. But for many statistics are a reality. They have lost jobs and are losing out to foreclosures. Rising food and fuel prices have made them give up the last hope of being able to keep the houses that are their homes. These unfortunate Americans are far worse than what they were seven years ago.

Looking at the two pictures can it be said that on an average Americans are better off? It is one of the crucial questions before the presidential candidates McCain and Obama. It is a question they are asking the voters to mull over.

There is no definite answer. Economists will throw the ball from one court to another without hitting the goal. For most the answer lies in the personal situation. CNN will be conducting a survey finding out of the hopes and fears of the ordinary citizen coming from all walks of life. To begin with CNN has asked individuals to submit photos and video clippings. Meanwhile the individual can go ahead with personal assessment against the background of the foreclosure crisis.

The first thing is employment – the foundation of economic health is the job or work. So the question to note is whether one is employed, threatened or unemployed with slim prospect of getting another proper job. Across the country unemployment has gone up by 5.7% - the figure of the late 2001.

The next thing is income. The earning figure might be the same but is it bringing in the same amount of goods and services? Perhaps the hours of work have increased or may be the salary has gone down making one work more for less. Nationally the income has not kept pace with inflation.

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The long tentacles of foreclosures in USA are now reaching out to affect the global economy. It is spreading with no signs of retreat according to the International Monetary Fund. Reporting on the global financial situation as in April IMF states that that the international financial markets continued to be brittle with indications of risks being high on the agenda.

It is a year now since the foreclosure crisis has made its presence felt in USA.. The financial institutions have bared their losses but the story has not ended there – the infection is spreading to other types of credit.

The International Monetary Fund is an institution consisting of 185 nations. It stated, “Credit quality across many loan classes has begun to deteriorate with declining house prices and slowing economic growth.”

Till about a year ago the foreclosure crisis was mainly thrashing the borrowers. Slowly foreclosures began to strangle the lenders in the country. They had eaten too much and the huge number of foreclosures led to their suffering from indigestion. But America is a big brother to all countries across the globe. There is a saying that when USA sneezes the others catch a cold. All those who had eaten at the same foreclosure table of woes are now showing symptoms of discomfort and economic ill health. Banks are being pressurized to raise extra capital despite the depletion of huge bank stocks. This has “increased the likelihood of a negative interaction between banking system adjustment and the real economy” according to the latest report from Global Financial Stability.

At a news conference Jaime Caruana of IMF said, “the downside risks outlined in the April GFSR appear to be materializing, leading to a negative feedback loop between the financial system and the broader economy.”

According to IMF calculations the banks and other financial bodies have written off $400 billion in mortgage investments. There is no sign of improvement with innumerable foreclosures waiting to be auctioned and signs that millions more will become delinquent. The call of the hour is to stem the tide of foreclosures in USA. The stumbling of Fannie Mae and Freddie Mac has further eroded confidence.

Banks are tightening credit and selling assets. In the first quarter of this year the private sector borrowing of US dropped by 5.2%. This level has not been recorded since the year of the last recession – 2001.

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The foreclosure rescue bill is poised to take off. By it both borrowers facing foreclosures and banks riddled with foreclosure related losses would benefit. Both the parties are supporting the bill for the general welfare. If all goes well than the bill will sail through the Senate on Friday 25th July. There are bumps ahead with some alterations required. The White House has been threatening to veto if certain major changes are not rewritten. But it seems that the preliminary hurdles have been crossed and the package is running on the proper tracks. The Senate has broadly supported it. This shows the general interest of the lawmakers belonging to both parties. Uppermost on their minds has been the welfare of the foreclosure victims. It must not be overlooked however that this is the election year and the economic weather right across the country is grim.

The main point of the bill will allow the Federal Housing Administration to support up to $300 billion of new loans that will be made to borrowers at risk from foreclosures. The new loans will have easier more affordable terms. The rate will be fixed for longer period. The lenders on their part will have to waive large chunks of the principal and thus avoid costly foreclosures.

Barney Frank (Democrat) chairperson of Financial Services Committee is one of the main architects of the bills. He commented that a number of leaders of the House are seeking some important revisions. These differences will be ironed out within the week. The week will be one of intense parleying at Capitol Hill against the background of Bush agreeing to sign the bill or not.

The FHA will be modernized and given a shake up. This has been a long-standing demand. A new regulator will be set up and there will be more strict control on Fannie Mae and Freddie Mac. The latter two are government-sponsored giants. The bill will also sanction $14.5 billion in relief from housing taxes. New buyers who would be purchasing properties for the first time will be getting a credit for $8,000.

The Democrats in the Congress are disunited over some important points of the package relating to limits on loans to be supported by FHA, amongst other things. Difference of opinion surrounds Freddie Mac and Fannie Mae also. The Senate wants to limit them to $625,000 but some, including the Speaker Nancy Pelosi want to cap it at $730,000.
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In the Tri-Cities foreclosures are increasing and this is leading to a rise in the activities of rental agents. In 2007 there were 1,098 foreclosure postings in Saginaw marking a jump of 23%. In Bay County there were 403 evictions showing an increase of 9%. In Midland the tally of foreclosures was 207 – 6% more than the 2006.

The Landlord Association of Saginaw has taken note of the pressure on rental units. Butch Burden the president of the association said that this is but natural because “people have to have some place to live.”

The renters are becoming very choosy about the place where they want to stay. Most want to stay in the Midland on the west side of Saginaw and the suburban areas. Mike Haman of Haman Property Management says he has rental units in Saginaw Township, Vassar, Carrollton Township and Thomas Township. He comments that rental market has picked up and in the forthcoming years it will become more intense. Things are picking up but it will be about a year before the effects can be really gauged.

RealtyTrac reported that in Michigan there was an increase of foreclosures by 25% in comparison to May. This has made Michigan rank fifth in the national foreclosure race. In May it had ranked 9th. In Michigan the May foreclosure rate was 1:353.

RealtyTrac shows that across the country there were 261,255 foreclosure postings during May marking a 7% rise from April and a huge jump of 48% from May of the previous year. The national foreclosure rate is 1:483 in May – the highest monthly noting since RealtyTrac started collecting data from 2005. May was the third consecutive month that saw a month-by-month increase according to James Saccacio CEO of RealtyTrac. In May default notices increased by 1% and the auction sales were down by 3%. But during this month bank takeover of properties surged ahead marking double digit increases. It is more than double the numbers of May 2007. This calculated to a total number of 700,000 properties owned by the banks.

It also shows the number of families thrown out of their houses by foreclosures. They are rushing to seek rented accommodation. Many investors are finding it profitable to buy discount houses and convert it into rented units. But with so many houses crowding into the real estate market prices are tumbling. This is leading to apprehensions that prices might further fall.

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The forthcoming presidential elections will have no effect on the present crisis – foreclosures will gallop along indifferent to the results of the elections in November. Presidents do not have the power to wave a magic remedial wand. Despite this Democrat Obama and Republican McCain continue to make loud noises and promises about tackling the foreclosure crisis.

Obama wants the government to play a more leading role than McCain. Both are for the FHA coming forth with more affordable new mortgages for the foreclosure victims. This is the only way the house owners will be able to refinance and shift on to a safer mortgage that will be insured by the government. The monthly payments would also be lowered.

The problem in executing this plan is that the lenders would have to agree to sizeable losses by waiving a chunk of the principal loan. On the positive side by allowing this they will save money by avoiding the costly, time consuming, judicial process of foreclosure. They would avoid the hassle of selling innumerable properties in the buyer’s market of today.

Obama is following the plan laid out by Senator Dodd (D- Conn) and hopes that it will benefit 400,000 foreclosure victims. It will not be required of borrowers to have impeccable credit history to avail of these loans. Obama’s point of argument is that “If the government can bail out investment banks on Wall Street, we extend a hand to folks who are struggling on Main Street.”

If McCain’s plan is executed a minimum of 200,000 to a maximum of 40,000 foreclosure victims will be benefited – they will be able to save their houses. But the help will be available only to those who had credit credibility at the time of taking the original mortgage. McCain comments that this will give every American straddled with a burdensome mortgage to trade it “for a manageable loan that reflects the market value of their home.”

Obama’s plan that is linked with that of Dodd and the FHA will cost about $1 billion. The money would come from the profits made by Fannie Mae and Freddie Mac during the housing boom. McCain’s plan, also linked with the FHA, will need minimum $3 billion to a maximum of $10 billion. This money will be got by diverting spending meant for other heads. Also the government would resort to borrowing.

Neither of the plans speaks of a long-term solution.

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Michigan has been especially badly battered by foreclosures, according to Mortgage Bankers Association. Across the country about 2 million houses were in foreclosure during the first three months of the current year, 2008. Foreclosure of houses increased from 42% to 54% nationally. Michigan has been one of the worst hit pockets. In January there were 11,554 foreclosures in Michigan. It calculated to a foreclosure rate of 1:366 in the whole state.

Dennis Nabors based in Keller Williams is a realtor having 25 years of experience. He comments that one of the main reasons for this foreclosure crisis is that many bought houses without making any down payment or “place no equity in the property”. Soon after followed the economic slump in Michigan. This caused many to lose either one or both their houses. With the houses having no equity they could not approach the banks for loan refinancing and modification to tide over the crisis. Foreclosures became inevitable.

The month of January saw Wayne County reporting a foreclosure rate of 1:124. In the Detroit region more than half the houses listed in the real estate market are coming from the foreclosure zone. The affluent localities of Macomb and Oakland too have not been spared. Here the foreclosure numbers increased by 108% in Macomb and 338% in Oakland. The market is far from hot. It is a buyer’s paradise. This is the opportune time to purchase and move into a better home in an upgraded locality. Recently one family bought a house to move into an area having better schools. Till now they did not have the chance to move into a house bigger than the one they were occupying. But the opportunity came with the seller paying all the closing costs. Finally they found themselves with a house loan with an interest of 5.75%. They sold their previous house for $210,00 and bought the new one for $212,000. The happy owners let out the word that this is the time for renters to move into houses of their own.

Nabors keenly watches the statistics. His reading is that the end is nowhere near in sight. Only when the foreclosure numbers show sign of decline can it be said with confidence that the market is turning. But there are no signs of it as yet. More foreclosed houses rushing into the real estate means supply continues to outpace demand. In fact it keeps on increasing leading to disastrous consequences for the seller.

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Jacqueline Scott is one of the many who have benefited from Hope America. This Ypsilanti based agency spells hope for many foreclosure victims. In 2006 Scott came to know that the unit where she was working would soon shut down. She promptly contacted her mortgage lender apprising the lending firm of her dilemma but they said that until she fell back three months in a row they could do nothing. Scott somehow pulled along with her mortgage payments for a year even after loss of her job. However she could not find another job during this time. Slowly she began to lag behind but little help came from the lenders – especially since it was sold to another bigger company. Finally she managed to get a job at less pay. But that did not convince the lenders that she would be able to carry on with the mortgage even with the help of her live-in fiancé. Scott bemoaned, “It’s almost like they set the system up for you to fail.”

The redemption period of Scott was scheduled to expire on 1st May 2008. In the beginning of the year she came to hear about Hope America a non-profit group based in Ypsilanti that lends a helping hand to those in trouble in Washtenaw County. The help covered a wide range – food, financial advice as well as foreclosure prevention. Hitherto Scott had gone through all the routine of filling up forms and processing the appeal on her own but it had come to naught. But when Hope America stepped in, suddenly the lenders were willing to talk.

Hope America debuted in 2005 and relies entirely on donations. It is a small body with two staff members, a Board of Directors and about 80 volunteers according to the Eleanor Walker, the Executive Director. Hope America organizes financial workshops and distributes food and clothing four times a year. Till 2007 in Washtenaw County 5,700 have benefited from their activities.

In December 2007 the foreclosure issue was included in their itinerary. This was in response to a rising number of foreclosures in the area surrounding Michigan. It offers financial advice and foreclosure prevention classes apart from interacting with individuals for specific support. So far about 50 to 75 foreclosure victims have been helped. They have avoided foreclosure by negotiations with lenders conducted by Hope America on their behalf. Few have lost out but that was because they sought help too late.

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