The US Bankruptcy Foreclosure Crisis – Home Owners Lose

You only have to pick up a daily newspaper to see that the bankruptcy foreclosure crisis is having a huge impact on home owners in the US. However, bankruptcy and foreclosure are actually two different entities. If I were to choose between one and the other, it would be difficult to say which way I would go, but the financial meltdown has caused this and at present it does not appear as though the situation is ready to bottom out.

Foreclosure is one of the stark realities facing US home owners who are unable to meet the payments of their mortgage loans. People have to choose between bankruptcy and a foreclosure and while a foreclosure reflects on your credit report for 7 years as bankruptcy appears for 10. Just because of the credit report implications it does not mean that foreclosure is the best choice, but we are not here to discuss these choices we are here to discuss the opportunities that the foreclosure crises has opened up for investors.

Today in the US, because there are so many foreclosure homes available, many people are taking advantage of this and buying outside the traditional real estate market. This is because it has opened up and incredible money making market. If you are already a home owner and have equity in it, have a little spare cash and a good credit report, you can buy foreclosure property as discounted prices.

This could be on of the best investment opportunities you will ever be presented with, and first time home buyers, individuals and experienced investors are making very good money in the foreclosure market. They can be purchased in pre-foreclosure, at sheriffs sales and as real estate owned property.

The most important factor to consider is that foreclosure property prices can be negotiated. This applies to a much greater degree than it does in the traditional market as property prices are down and many people own more on their homes than the mortgage loan is worth. Buying pre-foreclosure and auction property takes a great deal of leg-work and the risks are higher, but the rewards are also better in many instances. REO’s, are much like buying a home in the traditional marketplace.