When ex-President Bill Clinton visited Myrtle Beach recently, he spoke about Hillary having a plan to help the housing crisis by requiring a moratoriam on foreclosures. Though it would have been ineffectual by the time the November elections come around, it may have sparked an idea in President Bush to implement a similar government control.
The Bush administration has announced “Project Lifeline”, which has assembled 6 of the country’s largest mortgage institutions and had them to postpone foreclosures on qualified homeowners for 30 days. The financial entities will hopefully go out of the norm to help with re-writing and refinancing the past due mortgages…thus saving at least a few foreclosures from happening.
The lenders involved were JPMorgan Chase, Bank of America, Countrywide, Citigroup, Washington Mutual, and Wells Fargo. They have agreed to contact homeowners that are 90 days or more past due, and attempt to lower payments and work to help them keep their homes.
While this could offer help to a select few, a large number of buyers are letting their homes go back due to negative equity and the fact that the home they purchased is unable to be sold for what they financed. Lenders were far too liberal with giving “down payment loans” (which are no more than 2nd mortgages) and financing homes to the point that the buyer has no money to lose by letting them go back – in fact making them feel like foreclosure is the wiser choice.
Myrtle Beach foreclosures are not that high for primary home buyers. The majority of Myrtle Beach real estate problems are with with investment properties, and resulting from those who entered the preconstruction game too late. Several of the resorts in Myrtle Beach and North Myrtle Beach condos had escalated in price by the time of closing that they are no longer appraising at those prices. But from Pawleys Island real estate to Little River, our market is stablizing now, and prices have reached a plateau.
We will hope that the usual upsurge in purchasing and prices will happen as always when our season kicks in, and vacationers fall in love with our area enough to want to have their own place at the beach.