Thanks for stopping back by! There are 3 of us – Rick, Paul and Jayson

We’ll start making it easier for you to tell who you’re communicating with. Enjoy your weekend

The problem is the lack of government regulation in the banking industry. The tier of power goes like this: government–>bankers–>consumers. At the governments discretion, bankers are promoting mortgage loans that are higher than the consumer can pay, or should not be getting at all. However, the government gives the ok, in turn prompting bankers to sell and get more incentives, therefore misleading some unknowing consumers. Consumers are at fault as well, as they should know what they can and cannot pay.

The solution is to continue the investing cycle as before. Those who can afford to invest their money in homes should do so, and now is a perfect opportunity. Real estate values are dropping, but I have a hunch that they will steadily rise over the next year or so. Certain states did not take as hard of a hit as others in real-estate foreclosures. Austin, Tx is one. It is an optimal place for investments. I suggest contacting the Carvajal Group if interested, and are looking to make a long-term investment.

http://www.carvajalgroup.com

No love from James Houston Homes? I think he did a great job…especially the part where he said… “Next we do not need to see declines in property values stop all together. Things got out of whack during this last boom and they need to correct themselves. This is why a true bail out should not be part of legislature.”

Anyway, thanks for the free advertising.

James Wheelock and Go-Zone were drawn!

James has not gotten back to the emails that were sent so Go-Zone if you want to send me a 125×125 logo I will get it up today!

Thank you to everyone!

Next we do not need to see declines in property values stop all together. Things got out of whack during this last boom and they need to correct themselves. This is why a true bail out should not be part of legislature. Another thing we must not allow homeowners that can afford to make their mortgages walk away without feeling pain. This is the very reason I am not to thrilled with what the government has done to this point with giving those who walk away from their homes immunity from the IRS on the losses incurred by the lenders.

The incentives given to new home buyers have been written off like they are meaningless. This is strictly not the case for several reasons. First off the benefits to the economy are a shot of liquidity during this mess. New home buyers are almost guaranteed to spend the $7500 tax credit thereby proping up other areas of the economy so that the continued job loses in the housing industry are some what off set. Furthermore the fact these funds have to be paid back over time will help in not over heating the demand for goods. This will prevent it from causing a crazy spike in the inflation rate. As that would only magnify the pain Americans are already having to endure. This incentive will also move some of the glut of inventory we have so that we can get buyers to step back into the game.

The benefits to the buyer are having funds available to make purchases of furnishings and necessary improvements for the home they just bought. If you understand the time value of money you would understand that that a dollar today is worth more than a dollar tomorrow due to inflation. When you do the calculation of the net present value to the buyer based on the inflation rate the $7500 tax credit ends up having a true worth of $2257 today if they take the full 15 years to recapture the credit.

With this said I think the bill does leave something to be desired. More could have been done with less chance of the money being swindled away by local municipalities. At the same time the government nor the economists are going to fix this one. We need someone in the financial market community to step up like J.P. Morgan did in the credit shock of 1906.
Mr. Morgan got the whole financial community to assist in the market pain and help prop one another up. This prevented massive reductions in lending and soon the bad loans got written off all the while credit to businesses allowed for expansion of the economy straightening out the markets. Then investor confidence came back and the U.S. was booming again.

James Wheelock