Housing Market: Can It Really Get Any Worse?

An even gloomier scenario may be in store for an already ailing U.S. housing market if the overall economy slips into a recession, according to UBS Securities analysts.

Falling home prices, soaring foreclosures at a time of tighter lending and rising unemployment are all weighing heavily on an already troubled housing sector, the analysts said during a conference call recently.

Lack of funding is the biggest problem facing the housing market right now, according to the analysts, with subprime and Alt-A securitized markets shutting down and banks being forced to cut their mortgage lending dramatically due to capital constraints. So-called Alt-A loans are made to borrowers with less than prime credit ratings but who are above subprime.

Fannie Mae and Freddie Mac have also cut back their lending to stressed subprime and Alt-A borrowers with low incomes and high loan-to-value ratios.

Foreclosures, which have been building over recent months as borrowers default on risky subprime home loans, are not expected to peak until late 2008 to mid-2009.

So where do you see the housing market? We'd love to hear your opinion. Use the comment link below to sound off about it. Your email address will not be published here, even though it is required in order to post your comment.

Protection from Credit Cards

If new rules proposed by the Fed are enacted, some of the credit card companies' favorite sleazy tactics will be taken off the table.

The keyword here is, "proposed". If we ever hope to see any of this "proposed legislation" become reality, we all have to take action. Our Money Editor, Stacy Johnson, explains in this video. (Running time is 1:39)

Are you fed up with credit card companies and their seemingly ever-changing rules? Give us your feedback by using the comment link below. Your identity is protected, we never publish anyone's email address at this site. We'd love to hear from you.

Who Do You Blame for High Gas Prices?

Fed up with record gas prices, drivers often scapegoat big oil companies for high prices at the pump, but in a recent survey, more Americans directed their scorn towards Washington lawmakers.

According to a Consumer Reports Auto Pulse Survey released recently, 77% of consumers said the root of high gas prices lies with the government's failure to implement an effective energy policy. That compares with 75% of drivers who blamed oil companies, 70% who said foreign oil producers were at fault and 68% who thought the Middle East conflict was a leading cause for record fuel costs.

90% of those surveyed support an increase in alternative energy development, and 81% want the U.S. government to allow more drilling on and off our nation's shores. Americans also favored conservation measures, with 83% saying they supported tax incentives for alternate transportation.

For those who haven't adjusted their behaviors, the kinds of cars people drive are changing as well. In last year's survey, only 47% said they were interested in alternative engine types like hybrids, flex-fuel vehicles, or diesel engines. But this year, 80% said they would consider buying a car with an alternate-style engine, and 54% said they would pay extra for a more fuel-efficient vehicle. 15% of respondents even said they would even compromise on their vehicle's safety to save on gas.

What about you? Who do you blame for the high gasoline prices we're all paying? And have you adjusted any of your driving habits in order to save money at the pump? Sound off.. tell us what you think. Use the comment link below to voice your opinion, and remember, your email address will never be published at this site.

Happy 4th of July!

As we (here in the USA) approach the Independence Day holiday, we'd like to wish you and your friends and family a safe 4th of July holiday weekend.  We're taking a break from our traditional posting here for the holiday, and will resume our posts on Monday. 

As we all remember why we celebrate this holiday, don't get so caught up in cookouts and fireworks that you forget what our Independence really means, and all the men and women who are out there fighting for us so we can celebrate our freedom with our families. Our prayers are with the men and women in our Armed Forces as we celebrate this Independence Day holiday.

Be safe if you're traveling, and we will return with our regular posts on Monday.

Reverse Mortgages: How Do They Work?

Reverse Mortgages are exploding in popularity and as more and more baby boomers reach age 62 and beyond they will become eligible to cash in on their home equity with a reverse mortgage.

A reverse mortgage is a home loan you don't have to pay back for as long as you live in your home. It can be paid to you in one lump sum, as a regular monthly income, or at the times and in the amounts you prefer. The loan and interest are repaid only when you sell your home, permanently move away, or die.

Because you make no monthly payments, the amount you owe grows larger over time. By law, you can never owe more than your home's value at the time the loan is repaid. You continue to own the home, so you must pay the property taxes, insurance, and repairs. If you fail to pay these, the lender can use the loan to make payments or require you to pay the loan in full.

The amount of funding you get from a reverse mortgage usually depends on your age, your home's value and location, and the cost of the loan. The greatest amounts typically go to the oldest owners living in the most expensive homes getting loans with the lowest costs. Most people get the most money from the Home Equity Conversion Mortgage (HELM), a federally insured program.

Loans offered by some state and local governments are generally for specific purposes, such as paying for home repairs or property taxes. These are the lowest cost reverse mortgages. Loans offered by some banks and mortgage companies can be used for any purpose.

If you have questions about Reverse Mortgages, and whether they might be right for you, post your question or comment using the "comment" link below and we'll get back to you with answers to your questions, or find a loan professional who can answer your questions for you.