There are over 10,000 foreclosed properties for sale in Colorado. Are there more foreclosures in the future? It depends on several factors and how they play out.

If the economy continues to show signs of improvement, however slight, this should mean that more borrowers will be able to find or keep jobs which will allow them to make the mortgage payments on their homes. Banks have been offered financial incentives from the Federal Government to work out loan modifications with borrowers who have temporary financial difficulties, allowing them to remain in their homes.

Real estate values need to rise in general to make it more attractive for borrowers to try to keep their house. If the home owner owes more in loans than the house is worth, it really makes financial sense for them to walk away from the house. Of course, this will lead to a rise in the number of foreclosures.

Many lendings institutions have been reluctant to foreclose on borrowers who are in default on loans where the loan amount greatly exceeds the value of the house. Banks are trying to work out payment plans, loan modifications, or forbearance agreements, if they feel that borrower’s financial problems are temporary. The banks realize that if they foreclose on these properties and place them for sale on the real estate market, this will only depress prices further. How many of these types of situations are out there is hard to determine, but this is the wild card in the real estate deck.