Don't blame Real Estate
By Maria Mak - Sut... on January 8, 2009 - 5:25pm
Recent reports have suggested a direct correlation between a sharp rise in bankruptcies with the drop in house prices, but we should be careful not to draw this conclusion. Consumers need to be aware that the drop in real estate values is not the real culprit here.
I know it's easy for people to look at the drop in home values and the sudden increase in bankruptcies and come to the conclusion that one causes the other. However, when you think of it - it's not the drop in the value of your home that causes financial stress, it's your ability to service your mortgage and that's a factor of the sharp rise in unemployment, not the drop in home values.
Quite frankly, you qualified to make payments on your home in the first place, so once your mortgage is in place, what happens to the value of your home after that has little relevance to your ability to continue making those payments. So the real cause for concern for most Canadians should be rising unemployment - not home values.
So Please don't blame real estate, this is not a proper timing to point fingers at whoever, whatever.etc. Our economy will pull thruough, just like a roller coaster, it will be UP again one day.
If you're thinking of buying and selling real estate, contact Maria Mak and my team at Sutton Centre Realty at 604-839-6368, or visit my website at http://www.mariamak.com, you'll be smiling too!
Essential to financial success in the modern world, for good or ill, is building credit. A payday loan is one of the few, and they are few, financial services that does not require a credit check. That said, most other financial services do, and the credit bureau that they go to, or combination of them, reports your credit score to them. What a credit bureau does is they compile all the information that would pertain to your credit, like what accounts you have open, what late payments you've made, balances – they also report your employment information, car insurance, you name it. Once the information is compiled, they run it through a mathematical algorithm that determines your score, which may mean that you do not have good credit, but they report that score to the agency that requested it. What gets looked at in determining your score is astounding. You can read the article yourself entitled "Credit: Part I | Financial Tips from Your Payday Loan Source" on the payday loan money blog at personalmoneystore.com
While the real estate business does not deserve to take all the blame, I do think that it is still a factor in the rising bankruptcies. Unemployment surely takes a bigger percentage of the problem, but the fluctuations of real estate value keeps people off guard from the possible loss in their investments. At the end of the day, it is still the people who make choices. Caveat emptor is always the rule of thumb.
Robert