Avatar's Blog

Avatar strives to provide an initial response to every loan request – more than 2000 per month by the end of 2005, within 24 hours. Starting on January 2^, of the new year, loan requests began flooding into the office. I am more than three day’s behind in answering loan requests here at Avatar. (Not to worry, by Monday I will caught up again). But – brokers and investors take note…. I have to tell you most of the requests are the fallout of the draconian law signed into effect in April 2005. This sickening piece of legislation has ripped the bankruptcy safety net out from under responsible working families to the benefit of irresponsible credit card companies who foisted loans, credit cards, and other lending instruments on people who could ill afford to pay the usurious and ever increasing interest rates of these ravenous monsters.

The hardest calls I field are those from people who are losing their homes due to foreclosure. I hear the same stories again and again. Most say they “know” that “most people” who declare bankruptcy probably spent too wildly and deserved it, but their situation is different – they have a child, a parent, a spouse or other family member is dire medical straights. They have lost jobs, been hit by natural disasters, and more. The hear trenching stories go on. I’ll tell you what: this tall tale that people who go bankrupt and are foreclosed in America are in that boat because they deserve to be there is the biggest, most ugly lie corporate America and our own bloated-with-personal-wealth-they-want-to-protect-and-increase government officials we have ever seen. The founding fathers are rolling in their graves now. What’s next – debtor’s prison?

And what does that mean to brokers and real estate investors around the country? Apartment rentals are going to be hot – people who lose their homes need to rent a place to live. Condo converters beware. Some of those buyers will lose their homes with the adjustable rate mortgages now beating them into penury. They will be renting apartments next year and their condos will be selling for a song – which will directly compete with your ‘retail’ priced condos now being converted.

I’m looking for what this will mean to retail strip malls, office buildings, industrial centers, golf courses, ski resorts, mobile home parks, and more. The country continues to lose the middle class. Look to the extremes to serve the markets that are growing.