The stock market is not the only thing that can suffer from a bubble home prices can be affected by a real estate crash. During the notorious housing bubble of 2008, home prices plummeted to an all-time low and a large number of borrowers had to default on payments and foreclosures were at an all-time high. It lead to the greatest credit crisis and recession since the Great Depression.
While the crisis was the result of a series of factors, an Illinois real estate attorney will recommend that you protect yourself from the next crash by following these tips:
Determine When You Can Buy Or Rent A House
Houses are usually bought for long-term ownership. Most people stay in their homes for at least 10 years after they buy them, but the option to rent is available to them as well. So if you think that another real estate crash is imminent, rent especially if you don’t plan on living in the house for more than five years. The money you use to purchase can be recovered during this time but it may be too late to do so for you.
Protect Your Equity
While your home is a valuable asset, avoid borrowing against its equity unless it is completely necessary to do so. While emergencies can warrant a loan, avoid tapping into that solution unless you have no other source of funding. Interest rates can rise with some loans and equity can rise or fall. Paying minimum will become unmanageable down the line and if the market crashes, you may have to foreclose.
Conduct A Rating Analysis Of Your Savings Bank
Once you start earning, start saving some of your money as savings right away. Save the amount in a special account in a bank, a credit union, or a savings account. These establishments can host your account and offer growth in the balance at a specific rate.
Most banks and financial institutions invest extensively in real estate. So if the market crashes, they go down as well. In other words, if you want to save yourself from this crisis, evaluate your account holder with professional analysis ratings. These can let you know if the establishment that is hosting your account can survive a market crash or not.
Why You Should Hire An Illinois Real Estate Attorney
Selling or buying a home is one of the most significant life decisions you can make. Chances are that you will spend all of your life savings on it. As such, knowing and safeguarding your rights as a buyer or seller should be one of your main concerns. This is where an Illinois real estate attorney from Cover Marrero Covert, LLP can prove valuable.
We have experienced real estate attorneys who can guide you in the often complex real estate process. We are determined when it comes to managing real estate transactions and ensuring our clients make the best decisions possible. This includes the large number of tasks that go into a house sale. Get in touch with us for a free consultation in any of our Warrenville, Naperville, or Schaumburg offices today at (630) 717-2783.