Mortgage
The lending industry has, as of late, been in the crapper. Pardon the colloquialism, but it seems an appropriate descriptor. Profligate and relaxed lending practices combined with people eager to share the American dream of owning their own home have created a situation of perceived crisis in our economy. While the media, in its typical apocalyptic approach to presenting the news, has routinely overstated the problem, no one can deny that there is a real problem in the mortgage and housing industry right now. But, not everyone who has a mortgage is headed to foreclosure. The massive housing relief bill signed into law in late July promises to improve the climate for home sales and the mortgage industry. The bill’s primary focus is an expansion of the FHA. With the $300 billion FHA initiative, both borrowers and lenders will be assisted. The news today that the federal government took control of Fannie Mae and Freddie Mac was greeted with a ¾ point drop in the prime. The Wall Street Journal reports that the government intends to replace the company’s CEOs and invest nearly $200 billion as part of the rescue.As of today, one can obtain a 3o year fixed mortgage for as low as 5 ¾%. Investors appear optimistic and are re-entering the mortgage bond market as a conservative but guaranteed return on their money. The Dow Jones was up 290 points.
So, not all of the news surrounding mortgages is gloomy. If one could shake the mindset that has been created by all of the negative press, one could see that this is an excellent market in which to buy. Mortgage money is becoming available and until the run on houses begins again, prices are low. Blair Leckie, your friendly neighborhood realtor says, “Breathe easier, buy a house, invest in real estate.”
