Is One Bank Finally Getting It?

We have said numerous times that until the banks start negotiating with troubled home owners to prevent foreclosures, that real estate prices will continue to fall and the glut of the homes on the market will remain. Daytona Beach real estate prices have been hit hard with other areas of the country that were hot markets only a few years ago. Las Vegas, Arizona and California are experiencing the same problems that we are seeing. Now states like Michigan are losing jobs fast and will soon be in the same situation.

Bank of America is getting another $20 billion from the bailout fund, and part of that agreement is mortgage modification for existing home owners to stay in their homes.

Real Estate Bloggers had a post on their site that says that Bank of America and its subsidiary Countrywide will work to modify 630,000 loans. Why? It cost lenders up to $70,000 to foreclose on a home, and as more foreclosed properties come on the market it will take longer to sell their properties.

Owners of Daytona Beach condos and homes who are behind on their payments and who have Bank of America or Countrywide homes can expect at least a chance on renogiating, or modifying, their mortgage. I will publish update as more information becomes available.

I created a page last week that will report on mortgage mitigation and modification in Daytona Beach.. I wll be adding this news to that page in a few minutes to keep a running history of what’s happening in the mortgage modification sage.

The Affect of the Next $350 Billion Bailout for Daytona Beach Real Estate

Yesterday, the $350 billion in bailout or TARP funds were release by Congress. The release came in response to requests from the incoming Obama administration to help the national economy.

Part of the conditions of the second release is that financial institutions receiving funds work with home owners on mortgage modification or mitigation to help them stay in their homes.  Up to $100 billion of the $350 billion is targeted to individual home owners.

So What?

We have been advocating for mortgage mitigation as a necessity to the rebound of the Daytona Beach real estate market. Why?

1. There are too many homes on the market
2. More foreclosures are immanent unless action is taken
3. Too many homes drive down prices
4. Banks dumping properties through foreclosure and short sales drive down prices

Mortgage mitigation should help all four of the factor listed above. There are over 5700 Daytona Beach homes and condos listed for sale in the MLS as of this morning.  We sold less than 3,000 homes and condos last year. That’s not a pretty picture. Foreclosures and short sales will continue at a high rate until 2010-2011 unless more people can stay in their current homes.

Yes, it’s a hard pill to follow for those who continue making their payments. Helping people who many consider “irrepsponbile” angers many. I’m not going to take sides, but merely say, unless something changes, prices will continue to fall and more homes will become distressed properties. This action should help all home owners if prices stop falling and homes go off the market.

I’ve created a new page that on Daytona Beach Real Estate Mortgage Modification so that we can all keep current on the issue. Please visit that page for more.