REFLEXION TIME

During the last few months we have discussed various issues confronting home owners, buyers, builders and lenders. A consensus has emerged: the market is bad and getting worse, we have not reached the bottom yet.

This downward trend has touched all the players: lenders are losing money, builders are laying off employees and cutting down on new construction, and foreclosures are at an all time high. That is old news, now comes the time to decide what to do since houses are no longer flying off the listing sheets and buyers are not outbidding each other.

What can you do under these circumstances?
1. Stay put if you can afford it and wait for the market to rebound: it may take at least 2 years, at least that is what Realtors say, or it could take longer. Use that time to fix your property and your credit. You could refinance to a lower rate since all the major players want you to keep paying and you do not want to lose ALL your equity and ruin your credit. Loan modifications are becoming common practice, investigate this option.

2. Wanting to buy, well interest rates will continue to drop, so will the prices: be selective and careful because some of the inventory in the market may present some hidden dangers. Sellers strapped for cash and pressured to deal may have skimped on the maintenance. With tight credit, willingness, readiness must go along with strong Capability. Fine tune your credit and gather more assets, i.e. MONEY. No money down deals have become things of the past. Creative financing now means good credit and a down payment!

3. Get the right information:
Auctions, short sales, loss mitigation, foreclosures and redemption are some of the words that have become very popular these days: get to know what they mean before you commit or you end up sounding like trouble all the way. Not long ago interest only, pick your payment, zero down were ringing in every ad, now they sound like foul language.

Finally, remember that you have to make the payments: buyers pay the monthly note, and the sellers must pay back they loan they took to finance the property.
Good luck to both.