Even Loan Modifications Are not Helping

photo credit: AuthenticEccentric

During our financial crash, more like a twenty car pile up than a crash, the housing market really took a hard hit. In an attempt to salvage loans, help repair, and give the housing market a leg up, many banks and loan insurers made loan modifications under the Home Affordable Modification Program, but we are in it so deep it looks like even loan modifications are not helping the U.S. out of this mess.

About 677,738 people enrolled in a loan modification program and now about 629,751 have washed out of the program. Someone was thinking! President Obama himself has offered a positive outlook for the housing market and the overall housing picture, saying the HAMP program represented "just one, targeted piece of that administrations larger efforts on housing." With their track record I cant wait to see whats next.

I guess the Obama administration hasnt looked at the housing numbers today. The July existing home sales numbers paint a bleaker outlook than our leaders do. Although, I hear politicians all have their own set of numbers. Maybe we should look at their numbers and we can all feel better. The July existing numbers are lower than they have been in a decade, and they are not exactly making a sharp turnaround either.

The government, with the best intentions, thought they would help the housing market by offering a tax credit for people buying a home. Sounds good, looks good, free money, what could be wrong with that? Wait, this is America, we dont give free money, or do we? I dont remember.

Well, funny thing, the tax credit gave the housing market a false spike in the numbers, and when the tax credit expired, the numbers dropped lower then they were right before the tax credit, a lot lower. For some reason people panicked thinking that the loss of the tax credit was the end of home buying, and they stopped buying. I think the big lesion here is let a self adjusting system self adjust, and maybe make it a little easier for people to hire other people. Work, Make Money, Pay Mortgage!

Read the full article from Inman News

Posted on August 24, 2010 11:37:39 by Blog Author