Santa Rosa REAL ESTATE

This has been quite a week.  With a great deal of drama on Wall Street last Tuesday and then, for most of us, continued into what will doubtless prove to be endless questions about the importance of weak, mostly subprime mortgage loans to the recovery picture of the real estate market and to the possibility of recession in the overall economy.

The number of defaults among subprime loans has risen greatly, leaving the market in utter disarray.  Increasingly large numbers of borrowers are finding that they just can't service the (mostly) ARMs they took out within the past few years.  They can't afford the monthly payments, and because of tightening requirements for new loans, they can't afford to refinance those loans.  Further, because home values have ceased rising and they originally financed their homes ith low-to-no-down-payment loans, they can't afford to sell their homes in order to get out from under the existing financing they can no longer afford (assuming they ever truly could).

This all makes for a rising number of short-sale and foreclosure sales in the current market which, if ready to take action, could net a buyer a great deal.  Though short-sales and forclosures can be messy and take more time than one would like, they can turn out to be the best thing that could happen for buyers while sellers are also benifitted by having a means of getting out of an impossible loan with as little damage done as possible.