The Warren Group reports that foreclosures are up and likely to continue to go up because of increasing interest rates and sluggish real estate market. Read the article.
Where I work, most nice homes will sell unless the price is too greedy. However, I have seen a number of sellers who are losing money on their homes. I have already helped one buyer this year purchase a pre-foreclosure home.
Who are the people who lose money in real estate?
Some people have been exploited by lenders, some borrowed too heavily against the equity of their homes. Some are people to whom “life happened:” those who were transferred, had twins, divorced...or otherwise had to sell suddenly before they could accumulate equity.
How do you protect yourself? First and foremost: know your borrowing limit and what it will cost you every month. Know the cancellation fees, balloon payments, and figures if the adjustable rate goes up. The second: don’t buy a home you can’t commit to living in for 5-7 years. Third: (my advice of the week) Just say ‘no’ to bidding wars! Don’t make the EBay mistake. Walk away before you pay more than you should.
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