No question more foreclosure will hit the market. I think it is more of a progression rather then a wave, however, that will come at one significant point time, just like it is a progression that our economy is getting worse - stuff is happening every day and the trickle down affect on everything else slowly follows. Depending on the bank, REO's take a while to come back on the market for sale so even if one big thing happened to our economy/Country the foreclosure process would be delayed (and relative to each banks organization and internal process). Essentially what you will see is an increase of foreclosure inventory in a progressive manner (month to month rather than a predicted influx in the month of August, as an example).

Hope that helps. All this stuff is so hard to predict but what I think we can agree on based on government actions and the banks situations as of late is the foreclosure situation isn't going to get any better any time soon.

Yes. More to come. Many more.

http://www.therealestatebloggers.com/2008/06/06/option-arm-r…

These foreclosures will lower prices jmore over the coming months and years.

Jerry

We have not even scratched the surface yet. There are so many REO's that the banks have and a unknown (to us) total number that the FDIC has, that it will take us years to "clean out" this inventory. If you are looking for a single purchase, check out the local REALOTR in your area that deal with this inventory. If your are looking for investment grade properties, you need to find a REALTOR that is involved with the banks and FDIC as a listing agent for these institutions.
This is a great buyers opportunity, the rates are the lowest since WWII, there is a large inventory to choose from, and the market price is the lowest in years and going lower.
Thanks
Dave Caplin
Your MONOPOLY Coach

Jerry,

The short answer is: yes.

The long answer is: Google “Option ARM reset schedule.”

Ignore the data at your own peril if you believe the worst is over, friends. It’s pretty clear, we’re far-far away from being out of the woods.

The data shows that foreclosures will continue to pick up steam through 2011; longer if the government gets more involved. Combine that with a wage and employment picture that continues to sour and you’ve got yourself the makings of a big crap-sandwich. I hope American is hungry as this is going to take a while to digest.

The following is from http://www.housingwire.com/2008/09/02/fitch-warns-on-option-…

“Fitch analysts said they now expect roughly $29 billion in option ARMs to recast to higher monthly payments by the end of 2009, and an additional $67 billion to recast in 2010; of this, approximately $53 billion is attributed to early recasts.”

“Though recent declines in the 12-month Treasury average rates have mitigated some risks, the majority of option ARM borrowers have elected to make the monthly minimum payment over the past 24 months,” Fitch said in the report. “As a result, a large number of these loans, especially those with 40-year amortization and 110% principal caps are expected to reach their recasts before the end of the five-year mark.”

“The result? Fitch said it expects 90-day plus delinquencies — already ranging from 10 percent to 24 percent, depending on vintage — to more than double after recast for 2004-2007 vintage loans. It gets worse: Fitch also estimated that the potential average payment increase on the re-casting loans to be 63 percent, representing on average an additional $1,053 due each month.”

Good luck,
-John

Hello Jerry:

It is difficult to predict the if there will be a new "wave" of foreclosures, but I think most of us are seeing them thin out, not increase. As for ARM's adjusting upwards, most ARMS rates are based on indexes, most of which are very low - maybe even lower then when they were purchased. So I don't think that rate increases are much of a threat. I do think rising un-employment could have an impact, but it's not clear when that will happen. We're seeing things improve, and I have a couple of buyers "looking for a good deal" and there's about 75% less interesting stuff in that category than last year. That's a subjective estimate, but probably representative of my area.