It's January 9, 2012 and the fallout of 2007's real estate market frenzy is already peering it's ugly head! Remember the bidding wars that almost always resulted in prospective home purchasers offering tens of thousands of dollars over the asking price just to outbid the other guy? It was an exciting, but terrifying time for real estate clients who just wanted to get into the house of their dreams.
I met with a lovely couple this evening who, like so many others, purchased in 2007 at the height of the market. Their 5 year term is set to end in a few short months, and what they have discovered is that their mortgage balance now exceeds their 2011 assessed property value. What now? Refinancing and re-qualifying with a new lender may be out of the question. You may need to stay put (with your present lender) for another term and ride the wave. Let's hope our economy proves to be more resilient than the United States' and that property values recover by summer.
Are you a victim of the "Frenzy of 2007-Tragedy of 2012"? What do you plan to do in the months to come?
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