Upside Of Foreclosures

Foreclosures are ruling the headlines. While foreclosures are devastating to many home owners and families, it's a part of our society today. There are multiple sides to the foreclosure crisis and there is actually an upside to this mess.

There are more than one million homes in foreclosure in the United States right now and the banks that carry them aren't happy to say the least. They have quite a bit of work on their hands and their load is enormous. Home owners who go into foreclosure get bathed in bad credit and the loss of their home and banks who own the homes have to shell out to get them sold. On with the upside...

Unemployment rates in the country reached a record setting increase in May and increased to 5.5%. While the economy's screams are heard everywhere and the foreclosure crisis is being called out from a megaphone, there are secret hiding benefits lurking behind the scenes.

Someone has to maintain and take care of these foreclosures. Banks pay for these homes to be cleaned, a term we use to describe this is "trash-out." Majority of bank owned homes aren't left tidy and ready for the new owner, quite the opposite. They often require major hauling away and new locks. Some banks will even have homes repaired by contractors. Things like cracked windows, missing cabinet doors, etc. are items a bank may approve of and order.

Companies that specialize in trash-outs and contractors are busy hiring left and right. With so many orders being handed out by banks, these local companies are benefiting and actually bringing new jobs to the area. Foreclosures must stay maintained on the outside with lawn care and locks being re-keyed. Someone has to do this and the banks hire out private, local companies to do the jobs.

Foreclosures and bank owned homes prior to the foreclosure boom were typically sold in poor condition and banks wanted to dump them and be rid of the process. In today's market, banks are starting to step up efforts as it's harder to move these properties. Competition is stiffer and they have to bring these homes up to a more feasible selling condition to appeal to buyers.

This should help the market and home values if banks continue to put some money into the homes before they're sold. Neighboring properties and values should start to see a slight stabilization and increase. Banks play a factor in bringing the real estate market back to life. They were after all a large reason for the current foreclosure crisis to begin with.

Real estate brokers and agents are also working a different type of job outside of selling homes called BPO's. BPO stands for Broker Price Opinion. Third party companies are hired by banks to outsource price opinions from local real estate agents and brokers to determine the condition and price of the properties. Real estate agents can usually complete a BPO within a couple of hours and the company handling this gets paid along with the agent.

Then there's the short sale specialists and negotiators. Private companies that handle short sales, (the selling of a home before it turns into a default situation.) are also seeing an increase in business. There are even new titles and offices opening dealing directly with short sales.

While there's pain to be felt with the foreclosure mess, to many, there's also an employment boost and appreciated gain. New businesses are sprouting up and expanding due to this new avenue requiring attention and construction. People are getting jobs and small companies are seeing growth like never before.