Blog Carnival "Foreclosure Central" #1

This month the news has been packed with doomsday talk about subprime loans, mortgage fraud, and market correction. It seemed like a logical time to start a "Foreclosure Central" blog carnival.

The reality is, foreclosure rates have been steadily rising over the past six months. Many Americans are looking to the originators of these loans for their culpability. After talking to a few mortgage brokers I know, I do understand their origination thoughts.

Historically, lenders counted on the fact that home ownership is the cornerstone of the American Dream. They knew that the vast majority of us would subsist off of pancakes and ramen noodles for years on end to make the note each month. I know many white-collar professionals in southern California who have been doing just that.

Unfortunately, a number unscrupulous lenders preyed on this fact and "helpfully" refinanced people into notes they could never meet five years later. The broker got his hefty commission and called it a day. Some people who hold these notes did so to meet the demands of a life crisis. Others did it because they didn't read the fine print and thought they were getting a deal (in which case, I think they should refrain from signing any other contracts in the future).

Still others willingly and knowingly committed mortgage fraud. And now we're all up in arms over this fact, as it makes the "soft landing" that much further out of reach.

But while the inevitable foreclosure boom follows the home ownership boom, a lot of good people will get caught in the undercurrent. This is really unfortunate, and I know we're all pulling for the folks who face some serious belt-tightening in the coming months.

For the benefit of home owners, investors, and real estate professionals, here is what the blogosphere would like for you to know about foreclosure:

FORECLOSURE CENTRAL #1

TOP HONORS

Silicon Valley Blogger gets the (very subjective) First Place award for the article "6 Ways 6 Ways To Protect Yourself From Different Types Of Mortgage Fraud". The articles at http://thedigeratilife.com are always well written, and this one is no exception.

This is a great article for consumers, who can protect themselves from becoming unwitting co-conspirators in any number of fraudulent schemes. The article walks us through the different types of fraud and includes some great links on identifying and reporting mortgage fraud and abusive lending.


FOR CONSUMERS

Michael Emilio Rodriguez offers the article "8 Steps to Getting Your Finances in Order for a Mortgage. It's a good primer for first-time homeowners, particularly since those 100% loans seem to be going the way of the dodo.

I would add one piece to Michael's checklist. Since many homeowners will be paying more to own a home than they are paying in rent, start paying that higher amount now while you're planning to buy. Take the excess and put it into your house fund. Not only is this a way to cushion your savings for the home purchase, but you will acclimate to paying the higher amount now, rather than after close of sale.


Michael Cook writes in with "Influence Real Estate Appraisals: How an appraiser values your home can increase your property's worth". If you're selling your home this season, Michael offers some solid pointers on getting the most out of your appraisal.


Alvaro wants homeowners to know that foreclosures are difficult and emotional situations, and shares some exercises and tips for better stress management. Certainly, if you are facing foreclosure, you will want to check out the article "Stress Management Workshop for International Women's Day".


FOR INVESTORS AND REAL ESTATE PROFESSIONALS

Walt offers a great reminder that "If You Want To Be Great, Money Should Not Be The Motivation". This is a wonderful reality check to the myriad "get rich quick" schemes in the world, and is certainly not limited to real estate.

Walt's piece underscores the reality that, in this life, we are all going to stumble and sometimes fall. Some days, the only reward is the work itself. Setting out with the intention of "getting rich" is akin to "getting famous." If you don't have some degree of passion for the endless work load, it's not going to pan out.


I was excited to see Craig S. Higdon join this carnival. As a 14-year veteran of commercial real estate lending, Higdon is uniquely qualified to speak to the investment side of real estate. Everyone should read his article "Commercial Real Estate Loan Myth Debunked!"

Goodness knows we like debunking myths around here, so Craig's article is a great addition to the carnival. As commercial real estate has remained strong in contrast to the residential market, I imagine he's had more and more people showing up in his office to do some similarly creative financing for commercial properties. If you're shifting into the commercial side, get thyself to Craig S. Higdon's website now.


THE LIGHTER SIDE

We get to wrap this up with a bit of a chuckle, thanks to the BiggerPockets.com Real Estate Investing Community. Check out "A Few (really crappy) Real Estate Domains You Could have Had". My personal favorite is www.thishousewilldrainyourwallet.com


A big thank you to everyone who contributed to Foreclosure Central #1. This will be an ongoing carnival for a little while, with deadlines on the 1st and 15th of each month.

If you would like to contribute to the next Foreclosure Central blog carnival, please use this Submission Form.