About 33,000 loans were foreclosed in January, according to a report by Black Knight, a mortgage data and analytics company. Additionally, the lender completed the foreclosure in February 2022 and he returned 2,634 U.S. properties, according to data from real estate data analytics firm ATTOM Data Solutions. That’s up 70% from last year (but still down 45% from last month).
What do these foreclosures say about the housing market?
George Latiou, senior economist at Realtor.com, said the rise in foreclosures in January was an early sign that many of the regulatory protections put in place during the pandemic to help Americans stay at home were beginning to wane. said to be a sign of In fact, during the pandemic, millions of people were put on mortgage payments, putting their mortgage payments on hold. Most of them have bounced back and put up with it in 2020 and 2021, experts say.
Those who hold out until 2022 are likely to suffer permanent financial hardship, said Holden Lewis, home and mortgage expert at NerdWallet. Additionally, for many, the grace period is about to end and they have outstanding loan balances that are in arrears during loss mitigation or even after mitigation has ended and could go into foreclosure in the coming months. there is. ’ says Latiu.
The rise in foreclosures also shows that the economic recovery, especially employment, is not complete. The economy has regained 18.8 million jobs, but is still not at pre-pandemic levels,” said Ratiu.
That said, “the silver lining for the housing market and homeowners is that the foreclosure rate in January was 40% below what was recorded before the pandemic,” says Ratiu. In fact, experts say the housing market remains strong (albeit rising recently), partly because mortgage rates are still near record lows. “The demand for housing is so much higher than the supply that no one will be repossessed for stealing. .
Should I buy a foreclosure?
No one wants to profit from someone else’s misfortune, but when looking for a home, you may come across a foreclosed property. Here’s what you need to know about a potential purchase.
First, it is important to understand the types of foreclosures offered for sale. Depending on the stages of the delinquency process, you may find an advance foreclosure where the lender notifies the homeowner that they are in default. A short sale in which a homeowner attempts to sell a home for less than its mortgage value due to financial difficulties. A sheriff’s sale auction in which default property is sold in court. A bank foreclosure known as a real estate owned (REO) property. Government foreclosure when property was purchased with a loan from the Federal Housing Finance Agency or the Veterans Administration.
Foreclosure properties can be found on multiple listing services (MLS), for example. They are also “published in newspapers, banks and websites. For buyers considering foreclosed properties, auctions are another place to find available homes,” Ratiu said. say.
However, in today’s market where prices continue to rise due to a shortage of homes for sale, buyers looking at foreclosed properties don’t always find stolen goods. “Banks that own REO homes have an incentive to sell them quickly, but they are aware of the market price and are committed to recovering value from the homes. It is important for buyers to have the home inspected to determine the physical condition of the home.Get an estimate of repair costs, which should also determine the offer price they may want. says Ratiu. Lawrence Yun, chief economist for the National Association of Realtors, added:
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