RealtyTrac integrated Microsoft Virtual Earth technology into its member website this week, allowing subscribers to view aerial and “birds-eye” photos of properties listed on the website (see sample below).

This powerful technology should prove especially helpful for those searching for pre-foreclosure and foreclosure properties because those properties usually don’t include a curbside photograph (something that has long been a stumbling block for buyers and investors). But now even those properties can be viewed from quite close range and from several different overhead angles.

In addition, RealtyTrac identifies up to 15 comparable sales on the maps for the pre-foreclosure and foreclosure properties. The visual representation of comps helps to quickly see how those properties compare to the subject property in terms of location, square footage and even appearance of the property.

We’re proud to provide this new product to our members, but we realize that it’s most likely not perfect as-is. Although we’ve tested it thoroughly, we’re guessing that our members will find a few bugs that we didn’t catch. And although we racked our brains to come up with the best product possible, we’re hoping that members will give us feedback on how we can improve it. So give us that feedback by commenting on this blog or sending us an e-mail at editor@foreclosurepulse.com.

“Created to extend the dream of homeownership to first-time buyers, the so-called FHA gift program instead has led to rampant foreclosures. Nearly 6,000 FHA loans have wound up in foreclosure in Colorado in the past two years, and during that time the program allowed more than 25 percent of FHA buyers to use gifts as down payments.”

The article recounts several stories of homeowners who paid just a few hundred dollars to buy their home, using a loophole in the program to obtain the 3 percent required down payment from the sellers — by way of a nonprofit agency. The purchase price of the home was raised to cover the “gift” shelled out by the seller, and appraisals were fudged to allow the buyer to take out a loan that covered the inflated sales price along with most of the closing costs.

The phenomenon of buyers overextending themselves financially just to get into a home is not a phenomenon unique to this loan program or Colorado. It’s not uncommon here in California for buyers to submit an offer above the asking price, with the contingency that the sellers will cover an inflated amount in closing costs for the buyer. That allows the buyer, who is likely taking out a 100 percent loan, to actually receive an ample cash payment at the close of escrow. These types of creative purchase agreements might leave the buyer unscathed in a rapidly appreciating market, but they’re an invitation for foreclosure in a cooling or even normal market.

View the full RealtyTrac™ U.S. Foreclosure Market Report to see more details about July foreclosure trends for the nation and all 50 states.

Alan Greenspan started directing this movie more than two years ago when he made the first of 17 consecutive edits (so-called “adjustments”) to interest rates, raising them 25 basis points each. Like a new director who takes over mid-production, Ben Bernanke wasn’t sure he liked the way the plot of this movie was going.

So on Tuesday Bernanke entered the editing booth, and instead of making it 18 straight edits, he hit the pause button on his digital editing machine and decided to pass the popcorn around to his production crew while he contemplated whether to leave the storyline the way it is, or to rewrite the script and shoot for an alternate climax and conclusion.

In the business world, the stock market reacted to the news by ending a roller coaster of a day slightly lower. The bond market — which called for the Fed to take a breather from making further adjustments — went unchanged for the day, and the real estate industry — which believes the market is in the midst of a major period of correction and headed for a soft landing — breathed a momentary sigh of relief.

The problem is, in Tuesday’s press release the Fed noted the slowing growth rate of the national economy, directly commenting on “the gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.”

Still, Bernanke and the Federal Open Market Committee, which did NOT make a unanimous decision this time (there was one vote against pausing rate increases) believe core inflation risks remain, although “inflation pressures are likely to moderate over time.”

The bottom line in all of this is that the movie’s ending is far from a certainty. If the national economy cools too much and inflation spins out of control, the country may experience a recession, resulting in a hard landing for the real estate market and an increased level of foreclosures. If that happens people may start losing their jobs like in the early 1990s, also resulting in increased levels of foreclosures.

Foreclosure levels are already expected to increase somewhat due to homeowners who bought more home than they could afford using creative financing vehicles. Thanks to next year’s expected reset of one trillion dollars in adjustable rate mortgages, many of these homeowners may find their mortgage payments elevated to a level they can no longer afford.

But the question remains: will Mr. Bernanke hit the play button again at least one more time later this year and continue with the rate hikes like many people expect him to do? Like any movie playing machine, it will only stay on pause for so long before it defaults back to the STOP mode. And then all bets are off as to how this movie is going to end.

Continue to check the Foreclosure Pulse blog to stay on top of the situation and feel free to chime in with your review of this ongoing drama.  Our goal, after all, is to help real estate investors, home buyers and real estate agents make the most informed home purchase decision possible.

A creditor foreclosed Tuesday on a half-completed project on Broadway near the Interstate 35-Interstate 37 interchange, clearing the way for progress on its hulking concrete building shells.

Villaje del Rio was conceived by Geis as a mixed-used development of apartments and office and retail space.

A preschool, a one-story office building and a drugstore all are nearby, and hundreds of condos and single-family homes ring the area. It's why mom-and-pop tenants such as Marc's Bagels and a nail salon are setting up shop ...