The Monica Foster Team
Menu
  • Home
  • Buyers
    • Close
    • Properties
      • Search For Homes
      • Request Home Search
      • 24/7 Virtual Open Houses
      • Our Listings
      • New Listings
      • Home Walkthroughs
    • Buyers
      • Buyer Representation
      • Luxury Home Buying
      • New Home Construction
      • Virtual Buying
      • Home Ownership App
      • American Dream TV
    •  
      • Buy with Cash
      • Cities / Neighborhoods
      • Relocation
      • Short Sales & Foreclosures
    • Buyer Resources
      • Buyer Videos
      • Community & School Reports
      • Area School Districts Facts
      • When Choosing a Home
      • Buyer Negotiation Process
      • Housing Programs
    •  
      • Property Disclosures
      • Ready to Buy
      • Ready to Move
      • Final Walkthrough Checklist
      • Homestead Exemption
      • Real Estate Flow Chart
    •  
      • Title Policy Rates
      • Contract to Close Process
      • Who Pays What?
      • Owning a Home
      • Mortgages
      • Mortgage Rates
      • Property Tax Records
    • Close
  • Sellers
    • Close
    • Sellers
      • Selling Your Home
      • Virtual Selling
      • Luxury Home Marketing
      • American Dream TV
    •  
      • Value My Property
      • Guaranteed Home Offer
      • Home Offer Consultant
      • Short Sale
      • Expired Listing
      • Relocation Company
    •  
      • Selecting Your Agent
      • Professional Photos
      • 3-D Tours
      • Home Staging
      • Virtual Staging
    • Seller Resources
      • Seller Videos
      • Ready To Sell
      • Priced To Sell
    •  
      • Ready To Move
      • Contract to Closing
    •  
      • Who Pays What?
      • Remodeling
      • Real Estate Flow Chart
    • Close
  • Raving Fans
  • About
  • Contact
    • Close
    • Social
      • Facebook
      • Twitter
      • Pinterest
    •  
      • Social Wall
      • Blog
      • YouTube
    • Help
      • Ask Us
      • Refer Us
      • Join Our Team
      • Join Our eXp Group
    • Close

Realty Blog By Monica

Chances of Another Foreclosure Crisis? “About Zero Percent.”

0
November 18, 2020 - General Information

There seems to be some concern that the 2020 economic downturn will lead to another foreclosure crisis like the one we experienced after the housing crash a little over a decade ago. However, there’s one major difference this time: a robust forbearance program.

During the housing crash of 2006-2008, many felt homeowners should be forced to pay their mortgages despite the economic hardships they were experiencing. There was no empathy for the challenges those households were facing. In a 2009 Wall Street Journal article titled Is Walking Away From Your Mortgage Immoral?, John Courson, Chief Executive of the Mortgage Bankers Association, was asked to comment on those not paying their mortgage. He famously said:

“What about the message they will send to their family and their kids?”

Courson suggested that people unable to pay their mortgage were bad parents.

What resulted from that lack of empathy? Foreclosures mounted.

This time is different. There was an immediate understanding that homeowners were faced with a challenge not of their own making. The government quickly jumped in with a mortgage forbearance program that relieved the financial burden placed on many households. The program allowed many borrowers to suspend their monthly mortgage payments until their economic condition improved. It was the right thing to do.

What happens when forbearance programs expire?

Some analysts are concerned many homeowners will not be able to make up the back payments once their forbearance plans expire. They’re concerned the situation will lead to an onslaught of foreclosures.

The banks and the government learned from the challenges the country experienced during the housing crash. They don’t want a surge of foreclosures again. For that reason, they’ve put in place alternative ways homeowners can pay back the money owed over an extended period of time.

Another major difference is that, unlike 2006-2008, today’s homeowners are sitting on a record amount of equity. That equity will enable them to sell their houses and walk away with cash instead of going through foreclosure.

Bottom Line

The differences mentioned above will be the reason we’ll avert a surge of foreclosures. As Ivy Zelman, a highly respected thought leader for housing and CEO of Zelman & Associates, said:

“The likelihood of us having a foreclosure crisis again is about zero percent.”

Monica Foster November 18, 2020
Tags:   Distressed Propertiesfor sellersForeclosuresHousing Market Updates

RELATED POSTS

NO COMMENTS

Leave a comment Cancel reply

Your email is never published or shared.

SubscribeSubscribe to Blog

Recent Posts

  • Stunning 2 Story 4BD 3.1BA Home For Sale in Friendswood
  • Stunning 3BD 2BA Home For Sale in League City
  • Charming 3BD 2BA Home For Sale in League City
  • Investment 3BD 2BA Home For Sale in Webster
  • Top Floor 2BD 2BA Home For Sale in Galveston

Categories

  • General Information
  • Home Walkthrough
  • Investment Properties
  • Lifestyle
  • New Listings
  • News
  • Sold Listings
  • Vacation Rentals

Our Social Networks

Our Social Networks

Brokered by eXpRealty

Certified Residential Specialist
Accredited Buyer Representative
Certified New Home Specialist
Accredited Staging Professsional
Certified Luxury Home Marketing Specialist
Seller Representative Specialist

Monica M. Foster

Monica M. Foster
The Monica Foster Team

Houston – Clear Lake – League City
Pasadena – Baytown – Beaumont
Galveston – Pearland – Sugarland
Katy

Main: 346.202.7307

Contact Us

© 2023 Realty By Monica, LLC  • 

Terms of Use  •  Privacy Policy
Texas Real Estate Commission Information About Brokerage Services
Texas Real Estate Commission Consumer Notice