Nearly 3000 U.S Banks are declared to be having a Risky Concentration of Commercial Real Estate Loans. Ranging from small to mid-size banks, they have been severely weakened by the financial crises that has Surrounded them recently. It is also predictedby the Real Estate Pundits in the U.S that this Crises in which could Also Lead to the Massive Failures among the small and Mid size Banks. So it also turns out that the banks are not responding so Less to this proptery Nightmare. It has been acknowledged FDIC that the Number banks troubled due to the financial crunch Has Increased up to 703 from 252 in number in the year 2009. The Banks are increasing the Loan Standards and Reducing the Number of loans that they are making. The Fact that many it Owners are now giving up on the Properties that are no longer Valuable just like many other Residential Real estate Owners in U.S.A, has caused the Default Property Rates to increase even Further.
These Kind of Defaults has becomemore and more common now, and are expected to rise even further in the next few years. The Commercial Real Estate Properties Usually Used to carry a Mortgage of about 5 to 10 years, Most of the Loans Made between the Years 2000 to 2005 are now coming up for a roll over as the credit Standards have become more and more restricted and the Borrowers of those loans simply do not qualify for refinancing of these loans anymore. The Report, "The Precipice" Indicates that even after lenient lending Standards of the Banks, 57 percent at the Mortgages still don't qualify for refinancing. All these Facts, figures and deductions indicate that both the commercial and the Residential Real Estate Markets in the U.S are facing a financial Crunch which is bound to rise at unprecedented levels in the coming years