Hitting Appraisals – Next Bomb to drop in this marketplace. The banks are already getting fat with foreclosures and REOs. There will come a point when they don’t want anymore properties in a declining market. LTV (Loan to Value) will drop from:
100% to 90% to 80% to 70%
Why? because property values are WAY over priced and WILL start dropping rapidly. BANKS will always protect themselves. They make money when times are good or bad. LOAN SHARKS…
It would be interesting to see how many transactions “Fall out of Escrow” as prices drop before they have a chance to close….
