causes and consequences of the foreclosure crisis

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Post on 09-May-2015



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Learn about the Financial Crisis. Its causes, solutions and even ways to take advantage of it are explained in this presentation. For more information visit


  • 1.Causes and Consequences of theForeclosure Crisis A look at the effects of the 2007 collapse of the banking and housing industries.

2. Housing or Real Estate Bubble Definition Real property which rapidlyincreases to the point thatunsustainable debt levels arereached relative toexpendable income as wellas other affordabilityindicators within the economy 3. Housing Bubbles How They Form Housing bubbles are created when fastpaced growth in the housing market goesunchecked and spirals out of control Factors include lenient and predatorylending, extremely low adjustable interestrates and a blinding speculative fever Housing bubbles are generallyundetectable until after the burst 4. Reasons For The 2007 Burst and Recession Adjustable interest ratesreset to higher levels In 2007, 1.3 millionsubprime borrowersdefaulted on mortgages andwere submitted through theforeclosure process 5. The Domino Effect High adjustable interest rates Millions of foreclosed homes Decline in home demand and home value Housing industry jobs were lost Jobs connected to housing industry jobswere lost, etc 6. The Domino Effect Prime mortgage holders defaulted Banks accumulated more foreclosuresthan they could move, compoundingthe mortgage crisis Shareholders and investors panicked Lending was basically brought to astandstill, etc 7. Government Response The Housing andEconomicRecovery Act of2008 8. Government Response The HomeownersAffordability andStability Plan 9. Foreclosure Help Talk directly withthe lendinginstitution 10. Foreclosure Help Talk to a HUDapproved foreclosureavoidance counselor 11. Foreclosure Help Seek out state andlocal foreclosureassistanceresources 12. Foreclosure Help Contact HOPENOW which is analliance of HUDaffiliatedIntermediaries 13. Foreclosure Help Contact TheHomeownershipPreservationFoundation which isalso affiliated withHUD and providesforeclosurecounseling and help 14. Foreclosures As An Investment Low-cost real estateforeclosures abound Millions of foreclosedproperties sit with aflooded banking industry 15. Foreclosures As An Investment Every day, tens ofthousands of homes arebeing repossessed Foreclosure propertiesare being sold for 50% orless of their actual value 16. Foreclosure Investment Opportunities Short Sales Negotiate withbanks onbehalf ofdistressedhomeowners 17. Foreclosure Investment Opportunities Public Auctions Bid against othercompetitors forforeclosedproperties 18. Foreclosure Investment Opportunities ForeclosureListing Services Normally foundonline Get the jump onother investors 19. Foreclosure Investment Opportunities Browse listings,photos and info Resources so youcan invest withconfidence 20. For more Information:


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