Real Estate expert Barbara Corcoran on the Today’s show this morning pointed out that in 2012 1.5M homes are in foreclosure, 3.5M homes are in the process of foreclosure and 10M home owners who couldn’t get refinancing are underwater. Foreclosed homes in 2012 will hit the market later in the year.
Home sales nationally for the end of 2011 were down 3%. In the Midwest sales dropped 4.7% and in the South sales dropped 1.7%. 1 and 3 homes did hit bottom last year but are coming back up. Also, twice as many contracts busted in 2011 than in 2010. The main reason is buyers couldn’t close on financing. Good news is that in 2012 the government had implemented an incentive for homeowners who want to refinance their homes. You can refinance your home without an appraisal and get the lower interest rate before they rise.
For 2012 buyers will most likely need at least 720 credit score. If it’s not 720 you will definitely jump through hopes to get the loan. Interest rates will still remain low and may go lower. If your thinking of buying in 2012 clean up and gather your credit score now. It will be just as hard to get a loan in 2012 as it was in 2011. Barbara’s theory is that lenders make it hard to loan money not because of restrictions, but because they want to have a reason not loan the money.