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How to Cast a Mortgage Lifeline?

Posted by billspaced | 1:03 PM | , | 1 comments »

Mortgage Meltdown
Congress might actually be doing something about the mortgage meltdown and subsequent credit crunch. We've all heard the stories by now, so I'll just summarize:

  • Homeowners are walking away from mortgages that are underwater, leaving banks holding the bag
  • Potential new homeowners and/or existing homeowners looking to buy houses have been squeezed out of the market by banks that are unwilling to lend to them, no matter what their credit scores, OR willing to lend to them but with high down payments (note: traditionally, a 20 percent down payment was the norm; however, with house prices spiraling out of control, normal folks like me couldn't EVER afford to part with $100k or more)
  • The Fed is busy trying to pull rabbits out of its hat to get this thing under wraps
So there is this bill being floated in Congress, called Frank-Dodd, after the two co-sponsors in the House and Senate, respectively, that addresses this problem and might just work. Let's cross our fingers that it all comes to pass and we return to nirvana where we rightfully belong. By middle of next year, preferably (my mortgage resets then and I want to sell before that).

How to Cast a Mortgage Lifeline? - New York Times
Blinder on the Mortgage Mess

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  1. Debt Free Revolution // 4/05/2008 10:10 PM  

    I honestly am not holding my breath waiting for congress to fix this! About the only thing Congress or the Fed can do is prolong the agony.

    Honestly, about the only that will fix it is a price correction in the market. If a 20% downpayment for your area is $100k, then it sounds like the market needs to come back down to earth. If you are looking to sell, then you probably don't want to hear that ... but that is probably the only real solution.

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