Foreclosure Hurts Everyone in Kokomo and Howard County!

Kokomo, Russiaville, Greentown All Hurt by Foreclosures

Contrary to what you may think, foreclosures hurt the entire community – Kokomo, Russiaville, Greentown, etc. With foreclosure sales making up 30-40% of all sales in Howard County, it is easy to think the only ones affected are homeowners who “lose” their homes. That would be wrong!

• The immediate hurt is felt by the homeowner facing foreclosure. Buying a house and making it a home are huge financial and emotional investments. To lose that home to foreclosure can be devestating to the homeowner for years to come. Besides the emotional toll, the homeowner’s credit will suffer for years to come – affecting everything from renting a home to employment to car insurance and much, much more.
  
  
• The community is hurt by declining property values. The more foreclosure properties on the market, the more those sale prices affect the sale prices of non-foreclosure homes.
  
  
• Believe it or not, many buyers are actually hurt by foreclosures. I can’t tell you how many potential buyers I have met in the past few months who really want to buy their first home. Six months ago, there would have been no problem. But things have changed – lender requirements have changed and some of these potential buyers can’t get a mortgage in today’s market. And some of those who can get a loan are going to have to pay higher interest rates on their loans.
  
  
• Lenders are also hurt by foreclosures. You may be thinking: “Well, they are the one’s who got us into this mess and besides, we all know they have lots of money.” First, think about lenders you know here in Kokomo. They are just like you and me – working hard to put food on the table, to pay the rent or house payment, maybe go to a movie once in a while, etc. Because of the high rate of foreclosures nationwide, some companies/banks folded which means some of our local lenders lost their jobs. Also on the national level, banks are losing money – they loaned money money on houses and the money isn’t being repaid! Instead, they are spending money to sell foreclosure properties for less than is owed on the house – which means they have less money to lend to potential buyers.
  
  
• Retirees – You ask, how are retirees getting hurt? And it’s not just retirees, it is everyone with some sort of retirement account (401k, pension plan, IRA, etc.). All these retirement funds invest the money they receive into various funds. Many of these funds are mortgages and real estate trusts. The whole idea is to make money for the retirement fund. With the losses banks are experiencing and the decline in real estate values, what do you think is happening to those retirement funds?

So when you see something in the paper or on TV about all the foreclosures in Kokomo, Indiana and think it really doesn’t have anything to do with you – think again! Foreclosures hurt everyone!