Strategic Default - is it the next wave of homes to hit the market? Strategic default is what banks call the event when people who can afford to make the payments decide to walk away. It is not the fact that the home owner can not make their house payments, it is that they CHOSE NOT to make payments. They continue making payments on a home that is not worth the loan against it. Most Americans are honest, ethical and responsible people. They try to pay their debts.
Many Americans harbor resentment and a growing anger because Washington DC insiders are being bailed out with tax dollars while the struggling home buyer is receiving no relief. It appears that the government is covering the losses the banks took on the bad loans that they made. Why should an individual have to personally pay mortgage payments for a bad debt?
These links are examples of the information homeowners are viewing.
(Note: you may have to cut and paste the links)
http://topforeclosuretraining.com/blog/2010/02/09/are-we-being-duped/ http://www.youtube.com/watch?v=SFuWW-Sju0c
www.mybudget360.com/the-art-of-strategic-mortgage-defaults-the-coming-wave-of-foreclosures-
It is possible that this kind of information is finding expression in the "Tea Parties."
However, Americans have a strong sense of fairness. They grapple with the idea that they have a moral obligation to pay their house payment. But, there is a growing feeling that the government is helping the insiders get rich and ignoring the middle class Americans.
This growing problem is not a hidden or concealed fact. The banking system has factored it into their forecasting. The banks are trying to prevent foreclosures. Foreclosure is expensive. They pay residents to move to prevent the necessity of an eviction.The property is vandalized and must be maintained while vacant. Banks want to do loan modifications. If some of the information (see links above) is correct, it is possible that they are not even losing money on a short sale.
There is also an additional solution for the banks to use. The bank can rent to the former owner under an arrangement of "Lease for Title." The bank can then hold the house until it is to their benefit to sell it.
As a local Realtor in the Corona Eastvale community, I have a strong confidence in the fact that the market in this area has stabilized. I have seen the prices increase over the past year. Yes the inventory has reduced to a two month level. Yes, there are many houses waiting to come onto the market. It will be another year or two before there is a feeling of a stable market.
As a local Realtor, I am happy to discuss [with you] what all of this means to your own personal situation.