Ouch. Although some analysts suggested July home sales would drop around 12 percent, the figures just in from the National Association of Realtors indicate July existing home sales numbers dropped more than 27 percent.
This is now officially insane, but you just knew is was coming. Touched on this in the show. Last night Neil Cavuto interviewed Professional Home Buyer Jeremy Brandt who said his business is booming because homeowners WHO CAN PAY, are not paying their mortgages, hoping to cash in on the very generous government program that allows banks to renegotiate the terms of their mortgage. It’s a 3 minutes video worth watching.
It’s anecdotal to be sure but it dovetails quite nicely with this Reuters story from last week. And you still think its a good idea for the government to bailout homeowners.
WASHINGTON (Reuters) – Recent data suggests that many borrowers who received help with mortgage modifications earlier this year tended to re-default on their payments, a top U.S. banking regulator said on Monday. “The results, I confess, were somewhat surprising, and not in a good way,” said John Dugan, head of the U.S. Office of the Comptroller of the Currency, in prepared remarks for a U.S. housing forum.
OK … here’s the video from last night.
As I walked through the living room just now, I heard talk of a 4.5 percent fixed rate mortgage on Fox News. Financial industry lobbyists are knocking on Hank Paulson’s door at the Treasury Department with a plan in hand to lower interest rates to help “stabilize” the housing market. Will everyone be able to refinance their mortgages at 4.5 percent?
Just who is Obama’s new chief of staff? I’ve been a bit behind this week in reading due to other commitments, but this afternoon was when I first heard about Obama’s pick.
Guess who served on the board of Freddie Mac in 2000 and 2001?
M. Jay Wells at American Thinker has put together a time line wrapping together – year by year – how the mortgage crisis happened. It’s a long post, but worth your time this Sunday morning.
The piece outlines choices made by our elected leaders – and influence by organizations like ACORN – going back to FDR’s New Deal in the 1930s. That’s right, it all started 75 years ago.
Is this not how all of this economic strife started? Connecticut’s Republican governor, M. Jodi Rell, wants local community banks to contribute $1 million each into a lending pool that will provide loans to small business.
I understand that most car buyers are not purchasing vehicles for an investment, but you have to admit that just because you’re upside down in a borrowing situation does not mean that you are unable – or unwilling – to make the payments.
When you took the zero down payment plan and drive your new car off the lot guess what? You’re upside down. You may owe more money to the bank than what the car is worth. It does not really feel good, but you make the payments. The same thing is happening to some home owners. We need to look at the culture of lending and borrowing.
Williams has another good column out this week, and it quickly sums up – for those of you who missed it – how this economic crisis started back in 1977 with the Community Reinvestment Act. Walter’s point gets right to the root of the problem.
Even though McCain and Obama want to lay the blame squarely at the feet of greedy people on Wall Street, this was not the fault of the free market. It was government providing – instead of promoting – the general welfare.
Earlier today, Chris Dodd – senator from Connecticut and Senate Banking Committee chairman – stopped by the Sheraton Hotel at Bradley Airport to meet with Connecticut business and labor leaders. He hoped the market would react positively to the federal government taking over a good chunk of the U.S. housing market.
As of noon ET, it’s not working out too well. But something mentioned at the bottom of an AP article in the Hartford Courant should be highlighted.