In 2008 a real estate and mortgage collapse occurred in the United States forcing many homeowners nationwide to face the sudden threat of foreclosure. Overall the nation experienced an economic decline that was hugely affected by this collapse. People were suddenly unable to manage the repayment terms on their homes and they were forced to foreclose or sell their homes for significantly less than what they had been worth at the time of purchase. This devastating occurrence could be blamed on a number of factors. One particular fault lied with the banks that approved people for mortgage amounts greater than their credit, income, and employment status would indicate they could handle. Down payments were also without requirements for some first
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The decision to purchase real estate is taken more seriously in light of the crash that occurred several years ago. Years of planning, saving, and educating oneself are common practices for any first time home buyer in today’s market. In addition, buyers today are benefitting from these past mistakes as they teach us to view mortgages with more serious financial responsibility than others have in the past. A large benefit of the collapse was the drop in value of homes while countless homes were being foreclosed on. This turned the market into a buyer’s market and made the dream of owning your own home a little more attainable for some. Although buyers did need to build a percentage of the down payment for buying a home, the down payment amounts were significantly reduced with the value of the home. In addition, buyers are encouraged to improve their credit score or down payment savings before being approved of a reasonable mortgage amount. A good credit score can get a larger amount approved for a mortgage but also increases the assurances between the borrower and the lender that the mortgage will be carried full term by a person of financial stability. This can be a huge benefit to the market as we work to reduce the number of foreclosures in the future and strengthen a buyer’s ability to live out their mortgages full term. Learning these lessons from this collapse is what has helped the real estate market to grow stable and strong for the
The decision to purchase real estate is taken more seriously in light of the crash that occurred several years ago. Years of planning, saving, and educating oneself are common practices for any first time home buyer in today’s market. In addition, buyers today are benefitting from these past mistakes as they teach us to view mortgages with more serious financial responsibility than others have in the past. A large benefit of the collapse was the drop in value of homes while countless homes were being foreclosed on. This turned the market into a buyer’s market and made the dream of owning your own home a little more attainable for some. Although buyers did need to build a percentage of the down payment for buying a home, the down payment amounts were significantly reduced with the value of the home. In addition, buyers are encouraged to improve their credit score or down payment savings before being approved of a reasonable mortgage amount. A good credit score can get a larger amount approved for a mortgage but also increases the assurances between the borrower and the lender that the mortgage will be carried full term by a person of financial stability. This can be a huge benefit to the market as we work to reduce the number of foreclosures in the future and strengthen a buyer’s ability to live out their mortgages full term. Learning these lessons from this collapse is what has helped the real estate market to grow stable and strong for the