More Homeowners Now See Foreclosure as a Viable Financial Option

Foreclosure could be considered as a logical and practical strategic option, especially for troubled homeowners. The shame and stigma that used to come with foreclosure of properties is now dissipating among a rising number of Americans. This is among the interesting findings of a semi-annual foreclosure poll commissioned by two Real Estate tracking firms and conducted by an online research company.

The highlight of the study is that many homeowners are now taking a new outlook about foreclosure. Interestingly, many well-off individuals say they are being realistic when they consider strategic defaults on home loans. According to such people, getting into a foreclosure could in turn be a smart financial option or decision to take.

Thus, it could be inferred based on the survey findings that many Americans now consider (or at least they willingly consider) foreclosure as one viable financial option. This is logically more truthful on foreclosure cases involving water mortgage loans. In such mortgages, the actual worth of home loan (plus all interests, penalties, and service fees) has gone more than the valuation of the property that has been used as a mortgage security.

The foreclosure survey was administered in November 2 to November 4. It polled up to 2,034 homeowners aged at least 18 years old. About 48% or 1,329 of the respondents indicated that they are willing to consider simply walking away from their homes if home loans’ values get bigger than the valuation of their properties.

Analysts assert that the poll results are not shocking. Several factors make situations worse. First, many lenders adjust their rates periodically (about every 12 months to 15 months) so that original loan rates get higher. Second, the weak housing market and falling home prices lead to depreciation of home valuations by about 35% to 50%. Lastly, the high unemployment rate is starting to take its toll on consumers.

It is expected that by the end of this year, defaults in US mortgages would hit record high levels. It is projected that by that time, up to 3 million families nationwide would have received foreclosure notices. Comparatively, that figure was at 2.8 million in 2009.

Market analysts also warn that by 2011, the volume of foreclosures would continue to rise. Numerous analysts agree that foreclosure problems would start to slow down by 2013. Real Estate recovery is expected by them by 2014. Everyone has to keep his fingers crossed.

For more foreclosure news, visit ForeclosureConnections.com.