Monday, May 23, 2011

ECONOMY - Is the Mortgage Industry Really That Blind?

"As Lenders Hold Homes in Foreclosure, Sales Are Hurt" by ERIC DASH, New York Times 5/22/2011

Excerpt

The nation’s biggest banks and mortgage lenders have steadily amassed real estate empires, acquiring a glut of foreclosed homes that threatens to deepen the housing slump and create a further drag on the economic recovery.

All told, they own more than 872,000 homes as a result of the groundswell in foreclosures, almost twice as many as when the financial crisis began in 2007, according to RealtyTrac, a real estate data provider. In addition, they are in the process of foreclosing on an additional one million homes and are poised to take possession of several million more in the years ahead.

Five years after the housing market started teetering, economists now worry that the rise in lender-owned homes could create another vicious circle, in which the growing inventory of distressed property further depresses home values and leads to even more distressed sales. With the spring home-selling season under way, real estate prices have been declining across the country in recent months.

EXCUSE me? DUH! This has just come to "their" attention? Is this industry really that blind?

Hint: STOP foreclosures, and refinance at affordable rates instead. In the long run, that would be more beneficial to the industry than their present course.

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