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Realtors express concern over increase in foreclosure ratesWednesday, January 3, 2007
The National Association of Realtors® and the local Silicon Valley Association of Realtors® are concerned over the rising rate of defaults and foreclosures occurring in many areas around the country. Many Realtors believe some families don’t understand the risks of taking out “exotic” mortgages. NAR President Pat Vredevoogd Combs is urging consumers to make sure they understand the risks and rewards of all types of mortgages before they make a decision on a loan. She also advised consumers to consult with a Realtor and to participate in mortgage education programs sponsored by Realtors before they buy a home. “We are committed to helping people buy – and keep – the home of their dreams, and an educated consumer really can make the best decision,” said Combs. “Realtors help Americans achieve the dream of homeownership. We work to ensure that homebuyers have access to the proper information so they can fulfill their homeownership goals.” Foreclosures are not only a disaster for families, but also for communities, according to Combs. Problematic loans are often made in concentrated areas, and high foreclosure rates of single-family homes can seriously threaten a neighborhood’s stability and a community’s well being. “Foreclosures can lead to high vacancy rates, which in turn, can cause all homes in the neighborhood to lose value,” said Combs. “We must equate the rising rate of foreclosure and defaults to the recent increase in market value of real estate,” said Tripp. “As real estate values have escalated, borrowers have been able to cure any financial misfortune or financial irresponsibility by using the increased equity in their home to solve their problem.” Tripp said as a result of increased home value, “many homeowners have become less fiscally conservative and taken on more risks than they should without consulting professionals. Some lenders have taken note of these trends and in many cases, urged homeowners to go beyond the limits of prudent fiscal restraint.” He said while Realtors do not have much control over the mortgage industry, they are a good source for referrals and can direct their clients to reputable individuals who are involved in various aspects of the real estate transaction. “Homeowners must always turn to the professional in real estate, their Realtor, to obtain the objective advice and knowledge as to how any new financing will impact, which in most cases, is their largest single asset in their portfolio,” said Tripp. “The Realtor’s knowledge and expertise was used in the purchase of their home and that same relationship should be relied on with respect to not falling into financial traps that are not in their best interests.” Consumers can go online and read brochures designed to help families avoid predatory lending at http://www.realtor.org/housopp.nsf/pages/mortgages?OpenDocument.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley. The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics. Variations of this article have appeared in local area newspapers. For further information, please contact Rose Meily at SILVAR Public Affairs, e-mail , or phone (408) 200-0109. |
