Mortgages and the Housing Market

Tuesday, 28 August 2007 at 5:00 am Pacific USA Time.

I happen to be applying for a mortgage right now… in the midst of everything that’s going on. In case you hadn’t heard what’s going on, people are defaulting like crazy, and some mortgage companies are closing their doors. The lenders and brokers working on my file tell me that every HOUR, programmes for which I would qualify are going away. It looks like less and less money will be lent because the industry is in chaos right now.

Think about how that’ll affect the housing market. If I don’t end up buying right now because I can’t get a good mortgage at a reasonable rate, then that’s one house that doesn’t get sold to me. Many that I’m looking at have already had to drop their prices, and have been on the market a while. Some I’ve seen are already vacant… they bought or rented something else, and left. Those people are paying two monthly somethings, and that can’t be comfy, so they are probably really looking to sell. My grandmother just sold her house after it being on the market I think around 2 years. She took nearly $200K less than her original asking price, which I thought was a fair price for what it was, where it was, and its condition.

We know the housing market is messed up. We know that Americans are more in debt than ever before. Bankruptcy laws got changed to make it harder to declare bankruptcy. Evidently, people are piling on debt, credit agencies are giving the credit, and people can’t pay. And we know that many Hurricane Katrina victims are stuck with being under foreclosure (I wonder if they even have a home for the bank to possess). Maybe mortgages are just the start. Maybe this is the tip of the iceberg on the economy, which hasn’t been terribly healthy during this administration.

Yeah, I’d like a mortgage and a house. I saw some really lovely ones. But I know that if I can’t get a good programme right now, I’ll just save up extra down payment, which will make me look like a star, which will open up more programmes for me. So I’ll get there. But what’s going to happen to other people? What will happen to all those homes that are already having a hard time selling once their pool of potential buyers gets smaller?

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Categories: That's Bad Marketing

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