Alabama First Quarter Foreclosures Rate
The number of Alabama homes entering some stage of foreclosure reached 1,912 during the first quarter of this year. It places the state at the 36th position for the highest house foreclosures rate. The increase in Alabama foreclosures rate can still be attributed to the many defaulting subprime loans. Still, the state is doing far better than the other especially Nevada, which topped the list with 1 out of every 75 homes facing foreclosure.
It is interesting to note that Alabama’s delinquency rate is above the national average. Perhaps, the reason for this can be traced during the housing boom when home values were steadily rising and borrowers with bad credit history were allowed to take out “band aid loans”.
These loans featured an interest rate that is fixed for the first couple of years. After this period, the interest rate will become adjustable and based on prevailing market rates. Unfortunately, interest rates have been rising over the past few years and many subprime owners find themselves with over 40% increase in loan payments. Without any capabilities to pay off their ballooning mortgage payments, these owners end up facing foreclosure and eventually losing their homes.
This unfortunate situation is actually advantageous to many investors and buyers. Currently, foreclosed properties are considered to have great return potential. Since most of these homes are priced based on the amount of mortgage owed, they are considerably cheaper than most brand new homes. Buyers should expect to spend a little amount on minor repairs to improve the property’s physical condition. But even with repair or renovation costs, buyers still stand to gain a hefty profit.
Because of the thousands of Alabama Foreclosure Listings in the market, it would consume much of your time to search for the ideal property that fits your budget and preferences. The key is having foreclosure listings from brokers like MostlyForeclosures.com. This method guarantees convenience as well as great deals.
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