I have been watching the real estate market as are most Americans. The real estate market probably is one of the top indicators of how the economy is progressing or perhaps how it is not progressing as we are all feeling these days. In the news recently there seems to be a growing trend toward a moratorium on foreclosures. Bank of America has halted all foreclosure proceedings across the country as they have too many in the pipeline and too much paperwork to continue. What does this mean for financing?
It is not far off that they will halt all loans altogether until they can get a handle on the foreclosure situation. This is providing a window of opportunity for those home owners that are in trouble with their current mortgage situation with the likes of Bank of America, but this also means that a backlash will occur from the banks and their lending practices. We have yet to see how this is going to change the interest rates and other parts of the lending process and with some of the banks paying back bailouts, we can see how the federal government responds. It is not clear yet whether the administration is buying into the moratorium on foreclosures.
It is clearly a new world of financing and real estate and this has a long term effect on our economy. It makes all the more reasons to get into factoring at this point and stay away from the ideas of long term financing, especially for those in the small business sector. We have yet to see the fallout of this type of move from the bigger banks but if it becomes a trend the real estate market will comes to s screeching halt.
