So you have read, heard, or know of someone affected by the current foreclosure crisis. You may have felt sad or sorry when you noticed that your neighbor, family, or friend had lost their home due to foreclosure, and you may had even said, "Boy I am glad it was not me."
It may not have personally been you, but if you are a home owner, you were definitely affected. Even if you are not a homeowner, foreclosure affects the community and economy, and that includes you.
When a home is foreclosed, the bank is forced to sell that home at a discount. Why? Banks are not in the business to sell homes - banks are in the business to loan money. Banks that have Real Estate Owned (REO) inventory, are not able to write loans on three times the value of the foreclosed home they are currently holding. The bank has to sell the home as fast as possible, and because of this they often sell the home at a huge discount.
Foreclosed homes sold at a discount affect the value and built equity of surrounding homes in the neighborhood.
An Appraiser performing an appraisal looks for comparisons of similar neighboring homes sold. During this process, the price of the bank owned home shows up and is listed as a comparison. Information is not always readily available regarding the specific details of a given transaction other than the type, style, and size of the home.
When a home is sold way below market value, you risk the potential of losing equity in your home.
If you know someone in foreclosure, or if you are in foreclosure, act now. Do not wait or avoid the situation. There are numerous counseling agencies available who are ready to help.
Aisha Boddie is a NJ Licensed full service Real Estate Agent. She is also a Lobbyist for AME's Advocacy who's goal is to educate, empower, and protect consumers.
Visit Aisha's Website for more information. Also, visit AME Consumer Advocacy
Aisha is committed to assisting clients with buying, selling, or renting the perfect home, investment or commercial property.
Source: www.articlesbase.com
