Foreclosures: Housing Crisis In America
Author: Simon Volkov

Foreclosures are at an all-time high in America. Experts
predict nearly 1.4 million homeowners will face foreclosure in
2008 and residents of Florida, California and Texas will take
the hardest hit.

In 2007, Arizona foreclosures rose nearly 40-percent and
Colorado reported one of every 345 households either filed
foreclosure or were on the brink of filing. Currently, the only
states immune from escalating foreclosure rates are Vermont,
Maine and the District of Columbia. However, experts predict
these states will experience an explosion of filings when
adjustable-rate mortgages begin escalating later this year.

How did the housing crisis in America occur and why was it
allowed to happen? Americans have always strived to reach the
American Dream of homeownership. When zero-down,
interest-optional balloon payment loans were offered, people
were attracted to them like flies to honey. Millions of
unsuspecting people were suckered into sub-prime loans and
invested in houses way beyond their means.

As adjustable rates increased, mortgage payments doubled or
even tripled. Individuals struggling to make their $1,000 note
payment were now looking at $2,000 to $3,000 monthly payments.
The sad reality is they simply did not possess the financial
means to pay their note. When the bubble burst, their dream
quickly became a nightmare.

Foreclosures not only have a devastating effect on the
homeowner, but the lending institutions and local community as
well. Individuals who reside in communities with high
foreclosure rates are forced to pay higher property taxes, local
taxes and increased fees for utilities.

Additionally, the potential for crime increases. Vacant homes
are a magnet for unscrupulous characters. Vandals destroy
property, oftentimes breaking windows and doors or leaving
graffiti on both interior and exterior walls. Criminals engage
in illegal activities including the sale of illegal drugs or
weapons.

Real estate experts claim each individual foreclosure costs
lending institutions approximately $80,000, while preventing
foreclosure costs less than $3500. If this is true, why are
foreclosures skyrocketing?

The primary factor stems from the fact that many people facing
foreclosure become paralyzed with fear. They avoid contacting
their lender and instead wait for the sheriff to arrive with
their eviction notice.

There are steps homeowners can take to stop the foreclosure
process. First and foremost, individuals in financial distress
should contact their lender. Foreclosures are usually handled by
the lender's Loss Mitigation Department. Additionally, the U.S.
Department of Housing and Urban Development (HUD) offers free
credit counseling through approved agencies and can assist
homeowners negotiate with their lender.

Analysts claim America's housing crisis will eventually make a
turn for the better. However, they predict it will take three to
five years to recover from the onslaught of foreclosures.

On the bright side, there has never been a better time for real
estate investors. With an abundance of distressed properties
being offered for pennies on the dollar, now is the time to buy.
However, not every foreclosure property is a great deal and due
diligence must be conducted before riding the foreclosure wave.

One of the best ways to invest in foreclosures is to seek out
private real estate investors who purchase bank portfolios of
real estate owned property. Investors are able to purchase
properties in bulk and pass their savings along to interested
parties. It's not uncommon to purchase bank foreclosures from
private investors with instant equity of 20-percent or more.

Although the real estate market currently looks bleak, there is
hope on the horizon. If you are currently facing foreclosure
take the first step and contact your lender immediately. If they
are unable or unwilling to work with you, contact HUD. While the
foreclosure process can be overwhelming, it can be overcome with
persistence and patience.


About The Author: Providing solutions to individuals facing
foreclosures; investors seeking solid investment opportunities;
and financial institutions who want to sell their portfolios,
Simon Volkov is a one-stop shop for real estate and investment
opportunities. Learn more by visiting
http://www.SimonVolkov.com.