Cheap Homes for Sale

Suddenly within the last few years the buzzword around USA is that there are many cheap homes for sale. This needs understanding. Can it be true that cheap homes for sale are available? If so – why?

Cheap homes for sale are as a fall out of the foreclosure crisis. Today the market is flooded with houses. There are more sellers than buyers and according to the simple rules of economics this is resulting in innumerable cheap homes for sale.

The great American dream is to own house. For one has to take a mortgage loan. But prime mortgage loans are not available for those with weak credit history. This led to the aggressive marketing of sub-prime ARM loans to buyers who did not understand the nitty-gritty of mortgages finances. Agents pitched in for commissions. Appraisers falsely increased the valuation of houses to expedite the sanction of generous loan amounts. As a result there was frenetic activity in the construction world. Prices of houses began to skyrocket. Speculators jumped in to invest. But when the honeymoon period of low interest rates expired monthly payments began to more than double. As one by one houses began to be foreclosed as borrowers failed to meet commitments the housing market began to fall and be flooded with cheap homes for sale.

In a desperate move the government at all levels held in check the rising interest rates but by the time that came into effect the damage had already been done. Like ninepins houses were bowled over by foreclosures. This led to more cheap homes for sale further pulling down prices – even below the loan amount. So more foreclosures led to more cheap homes for sale.

However what is one man’s poison may be meat for another. The cheap homes for sale are opening up opportunities for a new batch of investors and nest builders to snap up a bargain. With interest rates being lowered mortgages are once more beginnings to be available. Cheap homes for sale are available either in the court auctions or in auctions conducted directly by banks that have repossessed houses. Borrowers also resort to short sale. Before being taken up by the lure of cheap homes for sale it is expedient for the prospective buyer to thoroughly check the house. After calculating repair costs the cheap homes for sale might not be so cheap at all.

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