Recession Aftermath Still Hit Foreclosures Rock Bottom
Analysts say that the economic crunch that the world is experiencing would still be felt in the next one to two years. In the United States alone, recovery is far from being felt as the housing sector becomes more vulnerable as the years pass. Even with Federal support to GSEs like Fannie Mae and Freddie Mac, foreclosures still hit rock bottom at the end of 2010. For Fannie Mae alone, statistics about foreclosure homes in this institution shows that they owned around a hundred thousand homes before end of March.
According to Year End 2010 U.S. Foreclosure Market Report, there are at least 3 million foreclosure filings across the country. It is higher of 2% from 2009 and a huge leap of 23% from 2008 This shows that even experts say that the global economy is slowly recovering from the aftermath of the recession, housing markets’ recovery still needs a lot more reform to boost the sector.
The ongoing controversy surrounding foreclosure documentations and procedures led to many lenders to have second thoughts in proceeding with foreclosures. It has been the reason of increased foreclosures in the last quarter of 2010 and if this issue couldn’t be resolved, the numbers will rise. The government needs to handle this immediately in order to avoid obstacles in an already slow recovery. The Obama administration has yet to announce as to the amendments on the existing housing policy and if one exists, it needs to be more robust to support the issues surrounding the high foreclosure rates.
On the brighter side of things, GSEs are giving a lot of materials to homebuyers to educate them on how to avoid Freddie Mac and Fannie Mae foreclosures. Fannie Mae, for example, gives information through a website and an active hotline in case a homeowner needs help. For homeowners who want to avoid foreclosure, a short sale option is always available. Short sale is beneficial for the homeowner because the control of the sale is in the homeowner himself, not the bank. This option is ideal for property holders who don’t want foreclosures to appear in public records which affect future loan applications and even job applications.
The most important thing before entering any alternative for foreclosure is to study the options well and weigh both the advantages and disadvantages. Although the effects of the economic crunch are far from over, the best defense to battle foreclosure is to increase knowledge and awareness.
