Amerifirst Site Manager

It was a dark stormy night and the Collins family was huddled into the deepest recess of the house waiting…hoping it wouldn’t happen, but knowing it was inevitable.

Perhaps next you are anticipating a man with a hockey mask and a chain saw to smash through the finely appointed French doors; however it’s much worse, more dire. It’s….foreclosure.

The horror of foreclosure has befallen our friends, family and neighbors across the country. At least one in five homes is currently experiencing foreclosure and the forecast still isn’t sunny.

According to AmeriFirst mortgage expert, Colleen Marie, it isn’t over until the fat lady sings and she isn’t singing anytime soon. Marie, a 17-plus year industry veteran has seen it all in the home business but this is a first.

“I got into the business when only four loan types were available. You had to have money to back your purchase and a job. Guidelines were incredibly strict, but financial institutions knew that when they made a loan, the borrower could pay.”

“Then came the driver’s license loans, which ultimately contributed to the mess we are currently experiencing. Essentially, everyone got a loan if they had a driver’s license. We began to experience the market fallout so we went from super strict guidelines to the other extreme.”

Marie reflects on what is concerning her—the next round of foreclosures. “What makes the current situation especially depressing is that the next round of foreclosures are homeowners with A credit paper.”

She says that the only way to hit bottom and find a way out is to stop the foreclosures. “The problem is that people can’t make their payments because they’ve lost their job. Instead of working with homeowners and taking a partial payment or allowing the homeowner to rent the home from the financial institution, banks continue to foreclose.”

“Foreclosures are impacting the home value market, which impacts loans. People can’t refinance their homes because their values are lower than what they paid.”

“The market is also being choked because now guidelines are so extreme, so strict that now no one can get a loan.”

Not wanting to sounds like the grim reaper, Marie insists there is a silver lining amid the mess. “Rates are amazing right now and there is a lot of opportunity for those who have solid credit and money to back their purchase.”

She adds that the homebuyer tax credit has also had a positive influence. “People are leveraging that money pay off debts or make improvements.”

Overall, we are going to have to ride this “perfect storm” for a little longer. Marie’s best defense against a falling market is education and learning how to communicate with your financial institution.

So if your hands are clasped firmly over your eyes, move your fingers aside so you can peek out between them. It still may be scary out there, but keep your eye on the prize—the bottom may be right around the corner.

If you'd like to talk further with Colleen, one of AmeriFirst's top loan professionals, contact her at (269) 968-6100 or drop her an e-mail at cmaire@amerifirst.com. You'll be glad you did.
 

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