Fact is, three long years and millions of foreclosed homes later, there's still a wave of foreclosures headed our way — just as we've been warning readers about since the early days of 2007.
We're nowhere near the end of a crisis that could cost us $1.5 trillion.
Yet, there are two very simple ways to profit from the very companies that help process the foreclosures. We're talking about two companies that process foreclosures — the very companies that profit when homes are foreclosed.
And we believe they'll be quite busy, and profitable, over the next few months.
Here's why…
Despite reports suggesting the housing crisis is bottoming out — strengthening home prices and few foreclosure auctions — there is no recovery in sight.
Government repayment programs and loan modification programs may show improvement, but they're just delaying the inevitability of troubled homeowners trying desperately to hold on to property that has dropped by tens of thousands of dollars.
Another obstacle for the housing recovery is the number of mortgages that are underwater where borrowers owe more than what the house is worth. This negative equity doesn't qualify those people for refinancing and even prevents them from selling the home, often resulting in "strategic defaults."
But the most devastating of all could be the coming Option ARM (adjustable rate mortgage) resets of 2010 and beyond. It could easily lead to higher unemployment, housing glut, decreased home values, and the death of the cash-strapped consumer.
What do you think will happen to housing when the resets happen? What do you think will happen when monthly payments on a $400,000 mortgage jumps from $1,287 to $2,593?
We'll see even more foreclosures, as Option ARM resets cause a larger number of foreclosures than subprime. Higher unemployment will deteriorate any chance of keeping some homeowners from defaulting. Homeowners will find it acceptable to strategically default on house payments, as it's just easier for them to just walk away.
And it could result in another three million foreclosures this year alone, partially caused because:
People couldn't afford the properties they bought;
Jobs were lost… and is only expected to worsen;
And others are just walking away because "it's not best for their finances… "
These "walk-aways" or "strategic defaults" have more than doubled from 588,000 between 2007 and 2008, according to reports. And there will be more, as financial "experts" tout the benefits of walking away from mortgages.
Does that sound like a recovery in process to you?
Unfortunately, just as 2007 and 2008 were years of subprime woes, 2010 will go down as the year of Option ARM resets. With billions in Option ARM resets in 2009 and 2010, this crisis is about to unleash a fury no one's prepared for.
It won't be as bad as subprime, of course. It'll be worse. We've just scratched the surface of the toughest problems of foreclosure… So if I were you, I'd ignore the housing bulls.
But like I said, there are two very easy ways to profit from the coming wave of foreclosures.
Unfortunately, the mere mention of the stocks in these pages of Wealth Daily would send the stock skyrocketing… and we can't afford for that to happen. But you can read more about this opportunity in our latest subscribers-only report below…
To get ahead of it right now, and assure yourself of these easy gains, just follow this link.
Stay Ahead of the Curve,
Ian L. Cooper
Wealth Daily
P.S. In the coming weeks, look for a new special report I'll be issuing on a very unique way to profit off of FDA decisions. I've discovered what some might call an "insider's edge" when it comes to knowing when and how to get in on companies awaiting key rulings on their products. And no matter which way the FDA rules, I'll show you how to make money. In fact, I've already zeroed in on one firm that could double your money by the end of April. Stay tuned…
