Saturday, June 28, 2008

Buying & Bailing in the San Fernando Valley

The term 'Buying & Bailing' means when a home-owner purchases a similar home while their credit is good, then walking away from their current home leaving the lender holding the bag (losses).

Though I do not advocate this kind of behavior, I can imagine more and more homeowners will want to make the switch. Just imagine owing $600,000 on your current home, then finding out a similar home down the street is listed at $350,000. The difference in mortgage payment can be substantial.

Though I do not personally know anybody who has done this, I'm sure this will become more prevalent as home-prices continue their decline in the San Fernando Valley. Lenders should work with home-owners who have fallen behind or who are unable to make the current mortgage payment(s) by possibly reducing their mortgage balance.

Written by: Richard Johnston, RE/MAX OTB Estates
I am a Short sale & Foreclosure specialist for the San Fernando Valley including the areas of Burbank, Studio City, Tarzana, Sherman Oaks, and Van Nuys. You can visit my San Fernando Valley real estate site for more information.

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