Fed cuts their rate 75bps on March 18, 2008

The federal reserve did it again lowering their funds rate 75bps. I still think it is going to take more stimulus action than just fed rate cuts to get the credit markets running smoothly again. At this point why not just drop it to zero.

The tide will come back in for the Real Estate Market

If you are worried that the Real Estate market is over, I think you need to draw on a simple metaphor. The tide goes out and the tide comes in. You need to trust that the tide will come back in. Nothing ever stays the same and something in the universe is always at work. The Real Estate market will come back. It has gone down before and come back, it will do it again. The savvy investor will be out buying, the rest will wait and see what happens. What will happen is that values will go up and the ones who were waiting to see what happened will wish they didn't.

Don't wait to buy real estate, buy real estate then wait.

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Paulson's mortgage bailout is a farce

According to a recent survey conducted , the majority of Americans are opposed to a mortgage bailout program. A government sponsored bailout would be unfair and very costly to American taxpayers. It is unfair to ask people who made prudent financial decisions to pay for those that did not. You could not create a bailout that would be large enough to stop the impending home price correction and the impact it will have on the economy.

Present home prices are disconnected from real estate fundamentals. It is not right for prices to be higher than the level of affordability in so many different areas. It is just natural that prices correct at a later date.

The majority of subprime borrowers are not falling behind because their loans are now adjusting; they are getting behind because they got into more house than they could afford right from the start.

Most experts agree that the plan will not save enough homeowners from foreclosure. Home prices will drop about the same as without the plan.

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Citibank lowers their loan limits to 85% LTV

Citi Mortgage a division of Citbank will be lowering their Max loan limits to 85% Loan to Value. Declining markets deemed by Citi Mortgage are in Arizona, Colorado, Maryland, Ohio, California, Washington DC, Florida, Massachusetts, Michigan, Pennsylvania, Tennessee, Virginia, Nevada, New Jersey and West Virginia. Not all counties are subject. You will need to check your Citi Mortgage executive to see if you county is excluded in each of the states listed above.

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