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Freeze on Foreclosure and Repo Houses Sales Hurts Florida Businesses

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By : John Cutts    99 or more times read
Last October, several lenders implemented a temporary freeze on the sale of foreclosed homes and repo houses while they review their documentation processes. The news was welcomed by troubled homeowners who considered the move a chance to find a way to save their homes before sales resume.

Among those who saw the freeze as positive are owners of foreclosed homes in Fort Myers and in other parts of Florida. However, some local businesses that have benefited from the housing market crisis were worried that the suspension will affect their operations, not least of which are landscaping companies, plumbing firms and real property brokers in Lee County.

For some state businesses, the rise in the number of foreclosures for sale in Florida provided more clients and chances of expanding their markets. The selling and buying of foreclosed homes not only benefitted plumbers and brokers, it also provided businesses to restaurants, furniture stores and other suppliers that have something to do with real estate.

When several lenders announced that sale of foreclosures and repo houses will be temporarily halted, most of these businesses felt alarmed instead of relieved. Some landscaping firms in the area have reported finishing their landscaping assignments, only to hear that projects have been put on hold as the properties cannot be sold until the freeze has been lifted.

Although the suspension has already been removed in most areas of the U.S. and listings of foreclosed homes sale have resumed, housing market observers are expecting foreclosure procedures to be conducted at a much slower pace as lenders become more careful in terms of processing foreclosure-related paperwork.

The temporary halt has already resulted in the lowest number of foreclosure-related filings in Lee County in October 2010. The area had a total of 565 for the month which represents the lowest filings total recorded in the county since 2007. Meanwhile, nationwide home repossessions declined by 9%, representing the biggest drop in repossessed property total for the current year.

Unless the sale of foreclosed homes and repo houses starts to pick up soon, local businesses claim that not much money will flow into the Lee County economy and this could cause a stutter in the area's recovery. They also believe that the county will benefit more if foreclosure inventories are processed at a faster rate.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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