Increasing Foreclosures
In July the amount of foreclosure fillings were up 93 percent compared to July 2006, and 9 percent from just the previous month. In Nevada, there was one filing for every 199 households, making Nevada the state with the highest foreclosure rate with the majority of these filings happened in Clark County.
The main reason behind these increased numbers seems to be that people were refinancing their homes to reduce debt rather than budgeting back. In other words, as long as everyone thought their home was going to go up in value, they would continue to overspend and accumulate debt, then refinance to consolidate their debt, and ultimately start the cycle over.
Owning a home is a great way to help ensure your financial future while having a stable asset to fall back on as a last resort. However, many people instead simply were using their homes as personal piggy banks that they had constant access to. They would allow it to build up some equity, and then break it open and completely empty it, never allowing the value to accumulate. Meanwhile, after breaking open the bank, in order to afford the increased loan amount, most homeowners gave up their fixed rate loans in exchange for an Adjustable Rate, not thinking ahead and in many cases not properly informed about what will happen when the initial term of their loan is up, and their interest rate jumps.
Although current trends have put many people in financial distress, the current foreclosure trend and cooling market may create a more realistic housing market in the years to follow. In the last few years of the recent boom, home prices shot up an astounding amount, and put the average cost of living per person over the average household income. Now that prices are dropping at an astounding rate, we may reach a point where people can purchase homes without having to resort to obtaining risky financing.
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Should you have any questions or need further information, please don’t hesitate to contact me,(775) 220-1630
Or visit my website at www.SellingNorthernNV.com
Joshua Talayka
Chase International
Office: 775 850 5900
Toll Free: 877 922 5900
Cell: 775 220 1630
Fax: 775 850 5901
985 Damonte Ranch Pkwy, Ste. 110
Reno, Nevada (NV) 89521
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Source of Information
Publication: Reno Gazette Journal
Title: U.S. foreclosures up 93 percent
Author: Alex Veiga
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