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Over the past several weeks many of the nation’s largest mortgage companies and banks – including Bank of America, J.P. Morgan, and others – have imposed temporary moratoriums on foreclosures. The decision to halt those proceedings against borrowers came about abruptly and was directly prompted by one of the most unusual twists in the ongoing mortgage crisis. This time it involves potential fraud and forgery that has helped some foreclosure attorneys make a lavish fortune off of contracts with lenders – while resorting to questionable legal tactics that resulted in evictions and foreclosure repossessions..
The shocking revelations of highly unethical and seriously erroneous foreclosure procedures that left huge gaps in legal documentation could wreak havoc on lenders across the nation. Meanwhile officials in all 50 states have launched investigations into the mess and professional mortgage investors around the world are threatening legal action against banks and other lenders. But what most LGBT home sellers want to know is how this bizarre new chapter in the continuing saga of America’s foreclosure crisis might affect their own efforts to market and sell property..
Although it remains to be seen how this current legal situation will unfold, many real estate experts predict that the short-term impact on sellers may be positive, not negative. That is because despite the many unanswered questions regarding how banks and other lenders provided justification for their foreclosures, one thing is absolutely certain. Removing the vast inventory of foreclosure properties from the housing market – even if it is only for a short period of time – means that LGBT home sellers have less competition for their own listings. Both individual home shoppers and professional property investors will have no distressed properties to bid on as long as the foreclosure moratorium remains in place, and that means that there will be a larger pool of potential buyers for other homes. Heading into the colder months of the year there are usually fewer properties on the market anyway, and it now appears that with the majority of foreclosures in legal limbo there will be even less inventory to choose from for those who want to purchase between now and springtime..
There is also the possibility that the court system will treat the oversights and mistakes of lenders and their lawyers with leniency and that these moratoriums may not last very long. In that case LGBT home sellers may soon find lots of foreclosures back on the market – even in their own neighborhoods. Whenever that happens it tends to weigh down prices while it also creates a drag on appraisal valuations. But this time around those distressed properties may pose less of a threat since buyers shopping for foreclosures are going to be a lot more wary, hesitant, and skeptical. That’s because there is still the possibility that courts may rule in individual cases that a foreclosure was done illegally or fraudulently. When that happens the title to the property reverts back to original owner and turns into a huge legal and financial mess for everyone involved. Title companies in some parts of the country, for instance, are already refusing to offer insurance of clear title on some foreclosure homes. Thanks to so much lingering uncertainty and growing nervousness the foreclosure markets will likely cool off considerably for the next year or so, leaving LGBT sellers with much less seller competition..
Regardless of which way the current scandal breaks, LGBT sellers need to be intelligent and pragmatic about their pricing. Unrealistic pricing is the main reason why sellers are having trouble finding buyers these days, and when there are comparable homes on the market that are selling at more affordable prices those will always sell first. But for those LGBT sellers who are keeping tabs on local prices and have their properties listed in a reasonable price range, there is some encouraging news..
According to a recent CNN report, for example, the average time on the market for homes in California – one of the states hit hardest by the bursting real estate bubble and spike in foreclosures – shrank to approximately 44 days in July. That was long before the foreclosure moratoriums were put into place, and this time last year the average time on the market around the nation was about 10 months – or 300 days. Typically anything less than 40 days is the sign of a healthy market, and when the time on the market shrinks to less than 30 days in the wake of a deep recession it is a bullish signal..
Meanwhile interest rates on safe fixed-rate mortgages recently fell to their lowest levels in history, offering an almost irresistible incentive to qualified buyers throughout the entire USA. In October 30-year rates fell below 4.20 percent, for instance, and homebuyers can also find 15-year fixed rate loans for about 3.65 percent. That’s a fantastic boost for LGBT home sellers everywhere..
To find real estate professionals devoted to serving the LGBT community, visit www.GayRealEstate.com, or call toll free 1-888-420-MOVE (6683). The site is home to the largest online network of LGBT Realtors in the world..