Real Estate Home Foreclosure Moratoriums and Shadow Inventory
Government real estate programs
Shadow inventory is made up of all the properties that are in foreclosure or headed toward foreclosure that haven’t hit the market yet. There are 7 million homes in this shadow inventory category. What the government isn’t telling you is that their moratoriums and loss mitigation programs created a huge surge of foreclosures that are about to pop.
Their effort to decrease foreclosures has backfired.
Home Loan Modification Plans Huge Failures
Government loan modifications
Home Loan Modification Plans - Fewer than 5 percent of all trial loan modifications on Freddie Mac loans stuck, that is, were converted to permanent modifications, according to a recent article on CNNMoney.com.
Under the Obama administration plan, qualifying homeowners would have their loans modified to payments that are no more than 31 percent of pretax income. During the trial period, homeowners must supply documentation to verify income and expenses. This appears to be the hitch. Some banks have begun sending servicers door to door to obtain the documentation, or have begun offering $25 gift cards to provide the paperwork.