Merrimack County foreclosure rate has jumped dramatically during 2006 with the rate up over 60% over 2005.?In 2004 the number of homes lost due to foreclosure was 33, but the figure of 1991 when there were 610 foreclosures in the County was the highest in history. The shock to the individuals and to the economy for those homeowners who signed up for mortgages such as the interest-only and adjustable rate mortgages with plans to refinance when the interest rates increased is overwhelming.?Many of these homeowners are already finding it very difficult to make their payments.
Because the real estate market is in stagnation as well, it's hard for these homeowners to either sell out or recover their equity or to pull equity from the property with a line of credit or homeowner's loan.?It's even difficult to do a refinance or re-fi because the equity simply isn't there.
Of the foreclosures so far this year, 40 are on adjustable rate mortgage properties from 2002 or later.?These are the loans, which were taken out with great interest rates during the first two to three years, but are now running into difficulty.
Adjustable rate mortgages generally provide a minimal fixed interest rate for the first one to three years.?After that time, the rates fluctuate according to the marker index used by the lender.?Interest rates can take a jump of several points all at once.?
As the name states, with an interest-only loan, only the interest on the mortgage loan is paid for the early years and then the principal portion payment kicks in.?These alternative funding mortgages would be a good deal, had the home values continued to rise at the same rate.?The homeowners would have been able to utilize the equity built up to refinance or to resell at better rates.
The Consumer Credit Counseling Service of New Hampshire states that foreclosure cannot be attributed solely to interest rates and the type of mortgage loan involved.?Credit card debt has increased, fuel costs have risen dramatically both for transportation and home heating.?When a house payment then increases at a rapid rate, homeowners simply can't pay because their income has not risen to the same degree.
People who are having trouble meeting mortgage payments should seek help early for the best chance of recovering and saving their home.
People who prefer to invest in foreclosed properties have a great market at present.?Banks don't want to hold onto foreclosed properties for any length of time, so many properties are available, sometimes at rates significantly less than market value.
While home foreclosures are on the rise, there is another side of this economic dilemma. Many investors are targeting foreclosures as profitable investments; unfortunately, this is not good news for most homeowners. Foreclosures are causing property values to decrease therefore reducing the value of homes that are not facing foreclosure. While people like to point out the good things about foreclosure, the key to preventing this from happing across the United States in too a avoid foreclosure in the first place.
Foreclosed homes invite vandals and a squatter looking for a place to go that is out of the weather. This spells disaster for neighborhood that has a high rate of foreclosures. Vacant properties will bring trouble and therefore drive property values down.
When lenders try to unload foreclosure properties as quick as the can, in many cases this means that lenders sell the properties at up to 40 - 50% of the market value. Even with properties selling this low, some foreclosures can remain vacant for an extended period. Just because the home is sold does not mean that there is someone moving in, many investors have vacant properties in there portfolio.
Here are a couple things that you can do to help protect the value of your home:
Keep your eyes open
Keeping watch of the properties in the area that have been foreclosed and are not vacant will help to keep your neighborhood free of vandals and squatters. Foreclosures are on the rise and thousands of homes a month are going into foreclosure. Keeping watch of the homes in your area will help keep the vandals from stealing appliances, damaging the property and forcing lenders to board up properties. Boarded up properties, are invitations to more trouble property values. Lenders will sell homes that have been boarded up for even less, just to move the property.
Do not panic and sell
Home ownership is a long-term investment, and while foreclosures are, on the rise, they will level out and the market will recover at some point. Remain calm and do not panic, no is probably not the time to sell your home especially if you are trying to make a little money. Home values are being driven down; buyers are looking to buy them cheap and below market value right now. In some cases you can still sell your home for a profit as originally planned, do not try to sell just because the local markets are flooded with foreclosures.
Home foreclosures are expected to rise considerably more in 2008, so hang in there, do not dump your house just because of foreclosures in your area. You bought it as a long-term investment to begin with, and this is a short-term problem. The houses market will recover at some point and your property value will likely rise once again.
Both Bob Smith & Ktbhold are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Bob Smith has sinced written about articles on various topics from Foreclosure Help, Shopping and Foreclosure Help. Bob Smith is the writter of . For more information on. Bob Smith's top article generates over 9900 views. to your Favourites.
Ktbhold has sinced written about articles on various topics from Search Engine Marketing, Foreclosure Help. Thomas Bladecki is the author and can provide additional information about foreclosure listings, current real estate news and conditions on the most popular cities, visit. Ktbhold's top article generates over 1300 views. to your Favourites.