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Increasing mortgage rates, coupled with a hot housing market, have
some pundits prepping for economic doom and gloom and the eventuality
of a housing market crash. e reality is that today we are in a much
different scenario than the great recession of 2008, so it's unlikely that
we will see a repeat of that foreclosure crisis, but that doesn't mean you
shouldn't begin prepping for trouble ahead.
Furthermore, what should be understood
is that the current housing market is on a path
of its own. is isn't a case of everything old
is new again; there is a perfect storm brewing
for the unprepared, and taking the right
precautionary tips will prevent your default
servicing from going down with the ship.
WHAT'S NEW IS NEW AGAIN
e incredible demand for housing,
coupled with limited supply, means this hot
housing market shows little sign of letting
up. At the same time, we are beginning to
see the strains that higher interest rates have
on consumers. Higher mortgage rates have
already dampened some plans for home
purchases. Here's the other side of this:
some homeowners are just returning to their
monthly mortgage obligations now that the
foreclosure moratorium is lifted, and they are
still struggling.
During the pandemic, millions of people
got mortgage forbearances that put their
mortgage payments on hold. Most have indeed
been able to resume their debt obligation
payments and end their forbearances in 2020
and 2021. Still, homeowners who remained
in forbearance into 2022 might be more likely
to be suffering permanent financial hardships.
Black Knight analysis said the number of post-
COVID-19 delinquencies in active foreclosure
Feature By: Dru Jacobs
WORKING
WITHOUT A
CRYSTAL BALL
Is your default servicing operation ready for the looming storm?
