Message #4 From:
Jason Date: June 17, 2008 03:41:49 PM
Real Estate Not Moving
Real Estate still has some very significant problems. They banks have placed a serious burden on new home mortgage applicants. Banks have decided to hold new mortgage applicants financially responsible for their past failures in properly managing home equity loans. Yes, thats right, in this case I am blaming the victim, Banks! Banks have consistently extended equity loans that far exceed the true value of homes. This is the single reason we are seeing a deflation in the housing market, sure you can say builders simply out build demand. But thats not an accurate answer to what actually happened. Banks approved mortgages for homes that far exceeded the homes true value, this allowed current home owners to upgrade, and new home owners to enter the market. Three major issues, loans that were nonsense, homes that were not worth the money, and pulling equity. Banks knew they were giving nonsense mortgages, thats why they packaged them, and sold the off to wall street. Everyone knew the homes were not worth what banking were willing to lend for them. Thats what caused flippers to enter the market! And finally the equity builders, on paper I'm worth a trillion dollars! But when it comes time to pay my taxes I'm broke. Equity builders attempted to buy fixer upper properties, fix them up, rent them, and then pull the equity to do it again. All this was done with balloon inflatable mortgages. The only problem with this tactic is the federal reserve! Banks should have known interest rates are prone to moving up and down!
