There are many Hot topics right now in the world of real estate. By far, the most logical one at this time is Short Sale. Unless you have been living under a rock for the past months it is hard not to notice our country’s economic situation. The auto industry is close to going out of business unless the government does something. Job loss is at an all time high in 14 years. Foreclosure is at an all time high, and homeowners are losing their homes left and right.

If you browse through t any news website, flip through open your local news paper, turn on the radio, tune in to any news broadcast and all you hear about are the record numbers of foreclosures in our country and the “sub-prime meltdown.” This economic situation has turned into a three headed monster, first unemployment rate is at 8% right now, second most banks have tougher guidelines, and many of them are holding their cash at the moment. Third Foreclosure is soaring at a rate which is unbelievable. And the media and any person who comprehend the situation say this trend will continue well into 2010.

The government’s response to what’s happening in the housing market right now have been dismal, the most effective thing they have done so far was lowering the interest rates. They have tried countless bailout, but it is not injecting the much needed cash in our economy. Homeowners are still losing their properties, the argument out there is did the Government bailout Wall St, but forgot about Main St.

A fraction of what’s happening to homeowners can also be blame on the rapid declines of home prices. Through countless refinancing, homeowners and investors pulled out every dime they could out of their property, leaving the home fully or over-financed. Homeowners didn’t have the income to support the monthly payments, and investors couldn’t get the much needed rent to cover the monthly mortgage payments. And because over 50% of loans originated the past 5 years were adjustable, we now we have meltdown because those ARMs kicked in and it became difficult for Homeowners to cope with the new payments, we should continue to see this happening for at least the next two years unless the bank comes up with a tactic and renegotiate certain loans, to help the homeowner.

There isn’t a trend that shows that foreclosure will start declining in the near future, there’s a 93% increase in the number of foreclosure this year from the same time last year. There’s a tremendous amount of REO fillings around the Country, banks are going down left and right. Part of it is because they have too many REOS on their portfolio and they just can’t get rid of all of them in a quick manner, and yet foreclosure is not helping them, so folks within the industry have been talking about a three months foreclosure moratorium to help some homeowners. The simple truth is, a 3 months moratorium will not help homeowners to the point they need, and it will only stop the bank from reporting foreclosure filling for three months. Most folks in foreclosure will not be able to come up with the funds needed to get their mortgage in good standing.

Some simple facts regarding our current economy, we know that the mortgage Crisis will only get worse in the upcoming year, which also mean that all you need to do as a Savvy Short Sale investor, is to offer a solution that will turn into a win-win situation for all parties involve.

We are getting closer to the worst economy meltdown since the great depression, incomes are down, the unemployment rate at an all time high since 1982, most homes are over leveraged, there’s a incredible decline in home sales, plus the number of homes for sale in the market just fuel the number of foreclosure that is happening everyday.

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