The video below is from a 60 Minutes episdoe which aired on December 14, 2008.  The story explains how we “may” be entering another bursting bubble in the real estate economy for “Alt-A” and “Option ARM” loans which could begin to default at a high rate. 

When Congress did the $700 billion Bail Out, it was to stop the bleeding in the Housing market. But the Treasury decided that Wall Street and the Banks/Insurance companies were the place to start. They may have been half right, but it all really started in the Housing Market, and that was where they should have started or asked Congress for all the funds to do a two pronged attack. For all their wisdom I think they are really out of touch with what is going on and how many people are just hanging on for dear life. Everyone is affected now by the Housing Problem. I firmly believe the whole economy has been pulled down by Housing. Commercial property is now the next to start getting hit. We are seeing it in the Malls where they can not get financing to refinance loans coming due. The money was given to the Banks but they decided not to loan it out. Wasn’t that great of our Congress to not put something in the Bill that said they had to lend it and not buy other banks.
 
I just heard on CNN that one of the Banks that got the money is buying a bank in China. If this is true how does this help our economy? Gas is down to $1.57 a gallon today at the station I watch. I see it going lower but not staying there. We are cutting off the dollars going to OPEC and they can not stand it. They will lower production again to try and push the price of a barrel of oil back up. They have grown accustomed to the money they suck out of us. Maybe they can feel some of the pain also. Again let me suggest we all slow down and save our fuel. Cut back on unnecessary trips.
 
In the next week or so I plan to expand on some of the Economy thoughts I have. We all do not agree on things I know, but I try to say in the middle and not put my will on others. If you care to comment we have provided that avenue but it has to be read by my webmaster before it is posted.

In doing some research for some homes in the South and Southwest I found a large number had gone under contract in the first part of November. Most of these were Short Sale homes and will take a while to get closed. Short Sales and Lender owned homes are taking up to two to five months to close. Many buyers get discouraged with the slowness and cancel their contract before it is finally accepted.
 
Wells Fargo (400,000), Bank of America (400,000) and now CitiGroup (500,000) are starting the process of readjusting loans that are in default and holding up the foreclosure process on the new ones that are just getting into the system. This will go a long way in keeping the owners in their homes. If they can stop the large number of foreclosures it will allow the housing market to hit the bottom and start coming back again. Fannie Mae and Freddie Mac are also doing the same. The big Bail out that was supposed to help will not even happen in the way they presented it. The money will go to the banks and it is your guess as to what will happen with that. I personally am not satisfied with what is going on. Housing started the problem and is still a problem, but not much is being done by the Bail out.

There is Bond money still available with up to 7% available for down payment and closing costs on an FHA loan. Call me for information. On October 1st, FHA the down payment goes to 3.5% which is slight increase and the Mortgage Insurance Premium (MIP) will be based on FICO credit scores. More and more, Government loans are being used today as compared to six months or more ago. Lenders are getting tighter and tighter with Conventional loans. Some are having a tough time getting Private Mortgage Insurance  (PMI) for the loans which can delay or halt your escrow. Right now it looks like the safe bet for a loan is FHA or VA if you qualify.

Call me if I can help you at 520-240-7130

The Housing and Economic Recovery Act of 2008 offers some hope for some of the owners who are in financial arrears to refinance   into a new FHA loan at 90% of the new appraised value if the owners lender will allow it to happen. In a sense it is a short loan process that could save the home owner and possibly save the lender much more of a loss if it went to a foreclosure. You can Google the act and get much more information. There are some good things for new buyers in the Act also. Unless the law is changed the seller will not be able to help the buyer with the down payment as of October 1, 2008. There is a Bill in the House trying to change this. You can still get help from Family members if it is available. FHA down payment goes to 3.5% on October 1st.
 
Lenders are getting tighter and tighter on doing loans. You need a good FICO score, good income and the all important down payment.
 
If I can help you call me on my cell phone at 240-7130.

The House and the Senate are in the process of working out the Short Sale type FHA package. It still could get Vetoed by the President if some of the things the Senate added are not compromised on. We really need this Bill passed.

A major bank was taken over by the Federal Reserve and Fannie Mae and Freddie Mac are getting Federal Assistance that will require Congressional Approval. I hope they will finally act for our best interest and not their political interest.

Slow down and save Gas!! Call me at 240-7130 if I can help you.

There has been a lot of news in the paper this past week. The numbers that they are using I know are not always true. I remember back around last July or so I found lots of double reporting by RealtyTrac. I also read that their statistics include double reporting when the house has a second loan which many did from early 2004 through 2007. The numbers can really look bad if you are not comparing apples to apples. We have 8808 residential units on the market right now and a number I heard was in the 4000’s that were foreclosures. I am not seeing that. There are a lot of them out there but not that large number.

If Congress and the President ever get the FHA program going for the coming foreclosures/short sales it will really help slow down the number of foreclosures and keep the owner in the house. I think it is a great bill and will help everyone including those that are trying to sell and did not have any of the tough loans. Everyone is paying and paying for this housing crunch. If you are against the bill I hope you have read the information I posted last month. The Senate is changing some of that bill and it will get even stronger. I see it as a pay as you go for the program and some real financial gains for the program.

Are you enjoying the high gas prices? Are you still flying down the freeway at 75 to 80mph? I have dropped back to 62mph on my trip to work. I have about 9 miles of freeway in my 18 mile trip. I do not scream away from the red light and I watch ahead to see what the light is doing. I slow down long before I reach the lineup of cars. I can not believe the number of people that race from signal to signal in their big SUV. Slow down and save a gallon here and there.

If I can help you call me at 240-7130.

Lets get real here!! The bill that the Democrats and a small number of Republicans  sent out of committee is one of the smartest things our House of Representatives  has done in a long time. The problem is, will the Lenders participate? Click here for a news item that shows me most of the public is uneducated about this bill.  I see people that are complaining have not read the Bill, and the News Media now has a new topic to feed on and misrepresent the truth.

Here is a summarized copy of the bill. Read it for yourself and see that this is not a bailout for the lenders or investors. If it goes the way it is written, the program will more than pay for itself and then some. The Old Lender is the one to voluntarily cover the costs of most everything. I think most of the Lenders will approve the chance for the homeowner to stay in their home and take the Short Sale amount and move on. As this program is voluntary for the current Lender, it simply gives them one more option for dealing with a loss they are about to experience, and the homeowner gets to stay in their home with manageable payments if they qualify.

Now you say “so what”. WHAT is the fact that when YOU try to sell your home In say, Tucson, Arizona you will not have as many of those Short Sales and foreclosures as competition in the sales market. Think about it, and this really will save a lot of people from going into deeper debt, and I am not just talking the homeowner, but the people that lost their job because we all stopped buying and the employer had to let them go. Now tell me what did that have to do with the so called Bailout? Absolutely nothing. We ALL caused that. I can give you lots of other examples, but I think you get the picture.

This again is the best solution I have seen yet. We have two years or more of this current housing problem if we do not do something like this bill. Read the Bill a second time and understand it before you say something that shows me you really do not understand or do not care about it. I am sure this Bill will get changed between the House and Senate but something along this Bill’s lines will help our floundering economy and bring many peoples lives back to a much better position.

Once you understand what they are trying to do, get in touch with your Senator and Congressman and ask them to support something along this Bills Lines. We need to get our President to also understand this is not a Bailout and that it will pay its own way. NO VETO!  I am not a Democrat but HOORAY for the Democrats.  Bipartisan politics is the only way to save our economy and our country!  Now if we can just convince our divided Congress of this.

You have my permission to copy this and send to Your Senator, Representative or whoever you think will help. Use anything in my thoughts that will help you write something to make that contact.

THIS is a very important issue.

Are prices going to go up? Not yet but we will see things starting to steady out. The Average and Median Sales price both went down in April but I look for them to come back to the March level in May.

If you are thinking of buying please talk to a lender soon. You will need to have the Loan Status Report (LSR) that the Lender will supply to your agent as it must go with your contract. No LSR, you will get a refusal from the seller because they do not know you are qualified to buy their home. This is very important!!  Call Elaine DeTour-Spronken at Countrywide  731-8382  Ext 235 for a very honest, service oriented Loan Consultant. Then call me at 240-7130

I am working with a lot of buyers right now and I am sure other agents are doing the same. Have we hit the corner? I think we have. Call me at 240-7130 if you need my experience and help.

Remember to slow down and save gas. 65mph is not really that slow and really saves Gas and Money.