A New York Mortgae Planners View:

True Character in hard times will determine your wealth in good times.

Tue, 24 Nov 2009 09:09:40 -0600

True Character in hard times will determine your wealth in good times.

In today's article in WSJ headlined Distressed Homeowners Ponder Whether to Stay or Go in my opinion tells the story of a couple that's faced with a test of True characteras well as financial literacy. Should they continue to make their payments on their house that dipped 48%, or let it fall into foreclosure.

The storyline goes that the couple can make their payment with the occasional dipping into their savings.

In quote "Some of their neighbors have walked away from mortgages they saw as losing bets. That is tempting because the Gindlespergers could rent another house for much less than they now pay each month for their mortgages, property taxes, insurance and maintenance costs.

Like others who are underwater, they lack a cushion of equity that would protect them if illness or a job loss slashed their income"

My Contention to the points above is as follows,

If the couple can make their payments why shouldn't they? Isn't this precisely why they have their savings in the first place?
If they choose to get out of the house and rent so let them sell the house and short sell it as opposed to just walk away. The impact on their credit and character might be less severe this way.
Real estate was always a game of long term appreciation and occasional depreciation. Over the long run, real estate appreciates at the rate of 3.26% averaged over 20 years. Considering inflation of 2 % meaning you earning more yearly with 2 percent meanwhile your mortgage stays fixed for duration, coupled with tax deduction for mortgage interest and a 3.5 to 4 percent appreciation in the value you will end up a winner down the line.
Owning real estate was always more expensive then rent. This is why rental apartments is a business in the united states. The unprecedented real estate market we had in 03-04 where it was easier to buy a house then to rent, actually wrecked the rental market and the housing market alike.
Equity although wealth, is no cushion. Equity is a cushion for the lender, and this is why they want you to make a down payment of 20% when buying a house. So that the homeowner will have some skin in the game and not let the house fall when the going gets though. Only cash in the bank is cushion and no equity unless borrowed against and deposited in to a safe deposit box.

In conclusion, when you are in the middle of the race occasionally you feel sore and the urge to drop out. But let's keep focused and not confuse ability's with choices. And to make Character testing decisions over unfair comparison which comes from fear and greed.

Sold - Sold- Sold - Brooklyn, NY Building for Sale Fulton Street mall 573 Fulton Street. 11201

Wed, 05 Aug 2009 17:42:41 -0500

Brooklyn, NY Building for Sale Fulton Street Mall 573 Fulton Street. 11201

Price: $6,800,000 MLS#/Listing: 342752 Property type: Commercial Square feet: 30,000 Year built: 1915

This Brooklyn, NY Building for sale in Fulton Street Mall is a 5 story brick building and Includes a total buildable 30,000 sq feet. Zoned as a CS-4-5. And sits right in the middle of the busiest commercial location in Downtown Brooklyn.

Price reduction from $8,000,000 down to $6,800,000. This is a give away price!!

Click here for a list of incentives to relocated your business to downtown Brooklyn.

Downtown Brooklyn is a neighborhood located in Brooklyn bordering Brooklyn Heights and Clinton Hill.

Home to the third largest central business district in New York City, Downtown Brooklyn is a predominantly commercial and residential neighborhood known for its soaring office buildings and impressive skyline. Borough Hall, the Kings County New York State courthouse, Fulton Mall and the Brooklyn Academy of Music are just a few of the many cultural, commercial and municipal institutions found in the area.

The New York City Department of City Planning has approved a significant rezoning for portions of Downtown Brooklyn, including the Fulton Mall area, which may result in significant expansion of office space and ground-floor retail. The rezoning consists of "zoning map and zoning text changes, new public open spaces, pedestrian and transit improvements.

Transportation

Downtown Brooklynis connected with Manhattan by the Brooklyn and Manhattan Bridges. The neighborhood has extensive public transportation accessibility; it is served by the New York City Subway by the 2, 3, 4, 5, A, B, C, D, F, G, M, N, Q and R lines, many one stop from Manhattan. The Long Island Rail Road stops at the Atlantic Terminal, located at the intersection of Atlantic and Flatbush Avenues.

For a list of Downtown Brooklyn events click here.

For a lit of Shopping In downtown Brooklyn click here.

Listing Agent: David J. Weiner (718) 207-2403 DaveW05@davidjweiner.net
Call today and present all approved funding to Schedule an appointment.

To discuss Financing options on this property
Contact Joel Silberstein
Certified Mortgage Planning Specialist
The Silberstein Group
917-660-3630
We are located in Brooklyn NYAlready Sold

Deutche Bank : Half of all Mortgages to be Underwater by 2012

Fri, 07 Aug 2009 12:44:31 -0500

New York According to Deutche bank half of all mortgages to be underwater by 2012.

The headline of this article poses the following questions,

•1. What is that underwater mean? We know that an iceberg is mostly underwater and can do great damage. Obviously that underwater doesn't make it worthless.

•2. If it is underwater whose problem is it the banks or the consumers.

Underwater mortgages means, that you owe more on the house then its value. In other words the collateral is not enough of a security to the bank, which leads me into the answer for the second question,

Whose problem is an underwater mortgage, and the answer is the banks /lenders. When a consumer buys a piece of property if it is for the long term which means 7-10 years time the consumer already profited. 1) Tax deduction on mortgage interest, depreciation on value regardless if it does in fact depreciate or not. 2) By owning property they hedged against inflation and the erosion of the dollar 3) appreciation and most of the time tax free.

The only who stands to lose in an underwater mortgage situation is the lender, because the lender has to factor in collateral and security for their money, and an underwater mortgage or a declining economy offers no security for them the recoup their money quickly. But don't worry for the bank they got other ways and techniques to stay in business most likely they will make it up in rates and upfront fees.

In summary my message is, don't let the headlines scare you, it is merely an estimate that lenders need to make for themselves and not yours the consumer. As long as your plan for real estate is long term which it should be, and you are working with a Certified Mortgage Planning Specialist who is capable of advising you on the most recent cutting edge financing techniques you're in good hand and continue to buy real estate because it will make you wealthy.

For a consultation you can contact

Joel Silberstein
Certified Mortgage Planning Specialist, CMP
www.mortgageplannerview.com

What causes foreclosures? Excessive borrowing, not home price declines

Wed, 05 Aug 2009 11:11:20 -0500

Check out this info below if you want to plan to avoid forclosure.

The key is to know the consecuence and not to look for someone to blame.

Via Spencer Rascoff (Zillow):

An interesting paper from several economists including two from Fannie Mae studies the causes of foreclosures in Southern California over the last few years. The paper seeks to determine whether it was home value declines or excessive borrowing at the time of the purchase and in subsequent refis that cause foreclosures. This is the sort of question that's fascinating to economists and academics but doesn't matter much to the homeowner who finds himself out on the street. But it does have important policy implications and it's helpful for us to understand as we start to post mortem the housing crash of the last few years.

Their conclusion? Excessive borrowing is the culprit, more so than home value declines:

"While capital losses resulting from the house prices declines that began, in most cases, in 2006 contributed to incidence of negative equity, excessive borrowing was clearly an equally important contributory factor. In addition, while house price declines were important in explaining the incidence of negative equity, its magnitude was strongly influenced by increased debt usage. Hence, borrower behavior, rather than housing market forces, seems to be the predominant factor affecting outcomes."

Impact of Negative Equity on Foreclosures

FAQ In todays Market.

Wed, 10 Dec 2008 16:48:52 -0600

FAQ by client's in today's market.

Will signing a 4506 trigger an audit: No! A 4506 is a document order from to get a transcript of your taxes from the IRS system. it is not a reporting form, and every lender is pulling transcripts from the IRS to substantiate that your tax documents are real.

Does it make sense to wait until rates come down?I don't think so because it is not a given that rates will come down. if there is the Slightest scare of inflation rates tend to go up. if there is more bad numbers from the Mortgage Bankers Association regarding default's rates might go up since it is more risk. Therefor don't wait if it is good now go for it refinance purchase or whatever it is you need to do.

What do I do with the savings from the mortgage is there where to invest these days? Oh please, if you look at the market it is going to rebound maybe not today maybe not tomorrow but it will have to regain at least 80% of where it is currently at, that puts you in a wining position. keep in mind wealth keeps on flowing from stocks into housing and from housing into stock if it gets stuck at any pint in time at in any of the ssector's it stand the chance to loose its value.
Should I Modify my loan even if I am able to make my payments? NO why would you? didn'tyou sign the document that you are going to pay back this amount each andevery month? If you lost your Job or have a difficult situation, the first thing you ought to do is to look for a new job and rain in a cash flow. If you cannot meet you monthly liability's then call your lender and try negotiating with them to drop the rate temporarily until you catch up and then you will pay the difference later once you have the cash or at the sale of the house.

My lender told me that they will not modify the loan should I default on my loan so they'll take me more serious?It is highly unethical to stop making payment to lender just because you want a break from the payments. if it really an issue most lenders will settle with you even before you default on the payments. Sometimes when your income is low that despite the modification it will still be above your capability then the lender will refuse to modify disregarding the fact if you are in default or not. A great solution would be you short sale the house to a friend or relative and you lease back from your friend with an option to buy in few years. So your friend can make money off real estate you save your house and might even buy it back for less then original price. keep in mind though that if you modify you might need to wait 4 years to be able to get a new mortgage on your name.

I recently opened a business and am making 4,000 a month should i tell my lender about it when they are asking fir a hardship letter when trying to modify the loan?. Tel them but mention to them that according to current underwriting guidelines self employment income needs to be averaged over 2 years. and if you just opened a business's they cannot count the full income as qualifying income.

Should I consider Chater7 Bankruptcy if i have so much debt? Without rendering legal advice i can render practical advice there is a limit to how many times you can go bankrupt in a 10 year period of time. ttherefore make sure you exhaust other option before so you can reserve this tool for when all other options are not feasible.

There is allot of pain in the market because we are coming form the past if we can think about the future things always look brighter!

So lets go out there and make a bright future for ourselves.

Sincerely

Joel Silberstein
www.joelsilberstein.com

Should I modify my Loan?

Sun, 09 Nov 2008 13:04:54 -0600

It Seems like everyone is considering to modify there loan these days. Especially that Sheila Bair who is the Chairman of the Federal Deposit Insurance Corporation (FDIC) said, "We will very aggressively pursue loan-modification strategies for unaffordable loans to make them affordable on a long-term, sustainable basis." therefore I feel the need to clarify the option that an individual has and the ramifications it might have.

First of all it is not ethical to modify unless you are really in need and cannot survive otherwise. Just because you can and the bank will agree is thievery. Its not the lenders fault that you made a bad investment, Man up and take responsibility.

To cut to the chase, If it is a Primary residence, and the balance of the loan is less then a 2 Million dollars before forgiving, it makes scenes to modify or trying to get the lender to forgive a portion of the loan since there will not be a tax problem for you on the portion forgiven.

However if the loan you are trying to get a portion of it waived is on an investment property or if the loan portion forgiven is more then 2 million dollars the lender will send you a 1099C in the end of the year and you will have to pay on the forgiven part income tax on top of the money that you earned this year, a real problem in some cases.

Things to look out for

Primary residence only.
Original loan you got when you bought the house, Sorry no cash-out refinance allowed.
loan balance before forgiveness was less then 2 million or 1 million if you are single or file separate.

If you criteria doesn't fit then don't do it you will have to pay tax on the forgiven part.

True Story

Jack did a modification on a 3,000,000 dollar loan and he did not ask his mortgage planner or his CPA beforehand. He negotiated the loan down to $1,000,000 and saved $10,000 dollar a month by doing so. At the end of the month Jack got a 1099 from the lender in the amount of $2,000,000.

Jack called his accountant and the accountant said he will have to pay taxes on the 2,000,000 which he was forgiven an amount of $700,000 and he will have to file for bankruptcy in order to get out of the bill.

Don't be like jack black contact professionals and don't rely solely on your Loss mitigator, ask your accountant and your CMP, CMPS before you make a move.

Sincerely

Joel Silberstein
Certified Mortgage Planner, CMPS

Please check out what are your option of you cannot continue to pay your mortgage. click here.

Wow a must see slideshow.

Fri, 07 Nov 2008 12:55:22 -0600

In the You Magazine issue of November which I distribute to my database monthly there is a link to a powerful simple truth video. I was moved to tears with the positive message reinforcements while looking at beautiful scenic picture and listening to beautiful music just a few words flash onto the screen . The power of that is amazing. its a real science of mind programing that most people don't know about. A story can be told with great detail but it will not move you deep inside. However reading the same story, on a PowerPoint slide-show with scenic pictures of the sun and nature with a combination of music can be really power-full and it can move your behaviour in the direction of the content.

Transformational Idea, Look at such a power-full slide show everyday for 10 minutes before your start the day and it will invigorate you.

To Test the theory for your self click here.

For more of such content for your mind and body and financial health, please subscribe to this on-line magazine free to you it will be delivered right into your email evrey month.

For a Sample of this months You Magazine Issue please click here

To subscribe click here

Sincerely

Joel Silberstein
Certified Mortgage planner, CMPS

BE AWARE: FEDERAL RESERVE WILL NEVER SOLICIT YOU!

Wed, 05 Nov 2008 08:45:42 -0600

Consumer Aleret on the Federal Reserve Website

Release Date: November 4, 2008

For immediate release

BEAWARE: FEDERAL RESERVE WILL NEVER SOLICIT YOU!

The Federal Reserve Board on Tuesday alerted the public to instances of questionable solicitations directed at consumers. These solicitations promise consumers access to personal loans through a nonexistent Federal Reserve lending program.

Under this fraudulent scheme, targeted individuals are told that that they can work through a broker to access a Federal Reserve program that extends sizable secured loans to consumers. Consumers are encouraged to deposit large sums of money into a bank account, under the guise of a security deposit, in order to receive the purported loan.

The Federal Reserve is advising consumers that it has no involvement in these solicitations and does not directly sponsor consumer lending programs. The matter has been referred to the appropriate authorities for action.

Consumers are strongly urged to verify the legitimacy of potential service providers before entering into a business transaction. Individuals seeking personal finance options are encouraged to do business only with reputable lenders and to shop around for the most favorable loan terms.

Consumers with questions about solicitations that they suspect may be fraudulent are encouraged to contact the Federal Reserve Board Consumer Help Center at http://www.federalreserveconsumerhelp.gov or by calling 1-888-851-1920.

Spread to your Database they Will forever be grateful!

Interest rate: What's that Exactly

Wed, 05 Nov 2008 09:24:05 -0600

Many people ask why if the fed cuts interest rates why did mortgage rates go up???

Another one, Why if the EU cut its interest rate why did the US dollar get stronger against the Euro and the Canadian and Against the yen etc.

Another question, why did the global stock markets gain yesterday when Australia cut its interest rate with 3/4, more then expected?

Here it is. I hate to break it to you but the truth is that the Fed's mission is not to provide low mortgage rates.

Copied from the Federal Reserve site itself and here it is,

"Today, the Federal Reserve's duties fall into four general areas:

conducting the nation's monetary policy by influencing the monetary and credit conditions in the economy in pursuit of maximum employment, stable prices, and moderate long-term interest rates
supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect the credit rights of consumers
maintaining the stability of the financial system and containing systemic risk that may arise in financial markets
providing financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system"

Reading through their mission statement in their own words did you see anywhere the word mortgages?

Here is the real story, we live in a world economy and we compete in a world economy, the players are the common people and the governments of the world. As in matter of fact there is a World bank where the big boys like USA federal reserve, and The bank of England, and the European Union etc. have accounts and pay membership dues.

The US has income just like we all are trying to have. The US income Consist of,

Interest rates that it gets from Banks who borrow from them.
The tresury bonds.
Consumers and business taxes.
Customs taxes.

Now if the US would to cut its interest it charges the banks who they lend to, would that limit the income for the US? Of course it will and if the US has less income they are perceived as weaker.

But if all your competition all cut their interest rates at the same time, the you are as strong as your competition! therefore when the EU cuts its rate, Australia cut its rates the US dollar strengthens.

Of course the interest rate cuts is intended to stimulate the US economy and it is a wise investment of the governments part, the short term is still a major factor and investors play by it daily.

Now back to the first question, Why when the fed cuts the Interest rates it does not reflect in mortgage rates?

And the answer is it that the fed does not directly control that! eventually it will reach a point where the mortgage rates are influenced and will follow the US interest rate trend, but it has no real correlation.

I hope I clears it up a little and if you have question or comments please do so and lets get educated.

Sincerely

Joel Silberstein
Certified Mortgage Planner,CMPS

Deflation: What is that

Mon, 03 Nov 2008 19:13:41 -0600

Well you sure heard about inflation right? that's when prices rise and the dollar looses its buying power due to fast growing demand.

Deflation is the exact opposite of that. that's when demand falls so short that prices will have to come down to move products off the shelf. So whats the problem you might ask?

Well 2 fold:

First of all for existing loans. existing loans which will be paid back in an deflationary environment will be paid back with more expensive dollars then the dollar borrowed, real bad for consumers.
It will further push economy in a stand still almost stone age like, because nobody wants anything so why would anybody pay you for anything?

A Little bit trivial but not as much as you would like. with talks of economic recession on the horizon and company's cutting back, with interest that low and a tight credit market there is actuial a possibility of deflation.

Idea to capitalize on : Stock up on money and lend it during a deflationary ENVIRONMENT YOU WILL GET BACK DOUBLE ITS WORTH.

You always need money when things go well, and when things do not. When all goes well you want to have asses to cash to capitalize on it. When things do not go so well you need it for security reasons!

Make sure you make the right choice with yours!

Joel Silberstein
Certified Mortgage Planner, CMPS
917.660.3630
joel@joelsilberstein.com

SHOCKING NEW STUDY: THE POOR BUY POVERTY

Wed, 29 Oct 2008 08:02:02 -0500

Hindsight is always 20/02 But the problem is you can only see what you understand. in example looking at struggling businessman coming out shining through a rough market, the person who does not understand business principles does not how he pulled it through. Versus a business knowledgeable person does know and can identify the principles that this struggling business person cling-ed to that help him through the rough market.

I just heard today about a 59 year old executive in the jewelery manufacturing business expressing fear that he will loose his job. He never bought a house because he was always afraid that if he might looses his job, where is he going to pay the mortgage from.

He never invested in real estate due to lack of knowledge of the real estate business.

He never invested in the stock marketdue to his lack of knowledge of the stock market.

You see the theme? He was always holding to his job and being good at what he was doing, but he wasn't growing,which brings us to the following financial principles.

Buy assets (Real estate or Stocks Bonds etc)that will go up in value.
Educate your self about these assets.
Change is inevitable, growth is a choice so the choose to grow and change will be easy!

Rich dad says: the difference between the poor and the rich is, The poor buy liability's, and the rich buy assets.

Owning your House is vital to your total financial picture the time to buy is now!

For Real estate financing advice please call me at 917.660.3630

or send me an email to Joel@joelsilberstein.com

Sincerely

Joel Silberstein
Certified Mortgage Planner, CMPS

The Silberstein Group
Brooklyn NY 11219

FEAR AND GREED OPPORTUNITY FOR THE WIZE

Tue, 28 Oct 2008 16:52:38 -0500

Although we are going through unprecedented times the basics financial principles have not changed.

•1. You actually have to qualify for a mortgage.

•2. You have to save up some money for a down payment. Lenders want you have a reason to work through hardships and not get dumped along with the house.

•3. The mortgage has to be properly planned because it does have the ability of robbing your life's savings.

•4. The mortgage has the ability to provide you with a comfortable retirement. Speak to your Certified mortgage Planner about that.

•5. Invest invest and keep investing. A down market will only increase your chances of hitting it big. it is called dollar cost averaging here is the technique from about.com

"Instead of investing assets in a lump sum, the investor works his way into a position by slowly buying smaller amounts over a longer period of time. This spreads the cost basis out over several years, providing insulation against changes in market price."

Strongest lesson is to see what the herd is doing and to do just the opposite. When nobody is buying Real Estate you buy.

When everybody is pulling out of the stock market due to fear, you do the opposite and start investing.

The idea is consistency and measured. Avoid fear and greed!

For more information on investing and equity management please contact me at

917.660.3630 or send me an email at joel@joelsilberstein.com.

Sincerely

Joel Silberstein
Certified Mortgage Planner, CMPS
The Silberstein Group

Mortgage Pro Week in Review 7/13/08 Through 7/20/08.

Thu, 24 Jul 2008 12:11:03 -0500

The first Time for me to do the Mortgage pro Week in Review. But who can refuse Jeff Belonger who is devoted to contribute that much information and knowledge to the group and active rain as a whole, I figured let me give it a try.

Here are the Highlights.

Did You know that you can do stuff.

Christina Ewing in her Post FHA Financing on Condos-You really can do it...I Swear!

Teaches us that you can still do a condo FHA loan even if the development as a whole is not approved with FHA. This is called Spot Approval Very informative!

Jeff Belonger in his post Kiddie Condo" FHA loans aka Non-Occupant Co-

Borrower Loans - What are they? In my opinion a amazing college planning tip. In adition it is a great follow up to Christina Ewing's post now that we know we can buy condos with FHA.

A word aboud Taxation.

Niman @TReXGlobal.com : TReXGlobal.com in his post I'm Selling My House to Myself because of Uncle Sam!!! explains a very important Tax planning tool how to depreciate market value despite the fact that you already bought the property 30 Years ago for 30,000. this post reminds us why real estate is such a great investment at all-times.

A word about your marketing. First of all know whom you are after.

Steve homer in his blog Are you Missing 39% of the Real Estate Market? makes great point The NAR is doing some significant research on buyers who they are and where they come from. Read it and learn how to look at your target market.
Misty Lackie in her post Save money, save paper and capture leads Makes a great point, Capture the leads don't just let the flyer's fly< Know where the fly.

About the Shame Blame Game.

Mike Mueller
Walnut Creek, CA
a real professional in my opinion, in his article titled "Lenn Harley is WRONG"in an effort to assign some blame the the real estate agents and brokers states very clearly the challenges we all had when the tide was high and many unqualified Mortgage brokers wrote in on it.
And when the ethical hard working Loan professional couldn't prequalify a client for the amount the Realtor expected, the Realtor had a few more So called mortgage brokers that he kept in his Rolodex that he turned to, to get the deal done By hook or by crook.
Janet Guilbault, California Mortgage Expert in her post Why The Mortgage Ship Sank and The Realtor Ship Sailed Ondelivers a beautiful story of the smooth sailing ship and calm sea we had until late 2007. but then the storm of 2007 hit and only the though and rugged sailors and the strong ships survived,
makes an excellent read.

New Rules coming down the pike.

Robert Ashby in his post Federal Reserve Issues Final Rule Amending Regulation Z (Truth in Lending)Covers the few changes we expected coming down for a long time what I like is his commentary.

Have a great week evreyone it was an honor to be part of an elite group like this. I learned allot from you guys and I hope I did contribute at least a percent of what I learned.

Make it a successful one, Think good and it will be good.

Sincerely

Joel Silberstein

Certified Mortgage Planner

What can you buy with one dollar these days?

Tue, 08 Jul 2008 10:48:22 -0500

Business week had a segment on their video cast how much 1 dollar can buy you today versus how much one dollar was able to buy in 1948.

Back in 1948 one dollar bought you a cup of coffee hamburger ice cream and some other desert.

These days, one dollar can get you a small can of Pringles. Pretty negative huh?

Well they left out one pretty significant piece to the puzzle.

Looking at the US wages history chart on the US labor department website you can clearly see that back in 1948 the minimum wage for an hour was 0.40 cents. That means that if you spend a dollar for lunch which was more then twice the minimum hourly wage then one dollar would have gotten you all these mentioned above.

These days Minimum wage is $7.25,lets have a look on what 1 hour of earnings can buy us today.

Looking just on the McDonald's Dollar menu you can have a

McChicken sandwich $1

Double Cheese Berger $1

2 Pieces of Pie $1

Fruit and yogurt farfait $1

12 once Soft Drink $1

Side Salad, $1

And golden French fries $1 or you can get all of it for just the price of minimum wage!

Pretty similar to 1948 huh or better of?

What does that have to do with real estate?

Great question! and the answer is that people are always hearing how cheep real estate was 20 years ago, how easy it would have been if we where only around then or would have bought then. But people often neglect to look at the income you had back then, See it is relative to your income.

I can bet you that in 20 years from now prices of houses will be allot higher then it is currently and the same chant of shoulda woulda coulda will be repeated..

In Summary

Act Now don't cry about the past.
l
Live in the here and now, plan for the future and learn from the past
. At least make sure then in the future you will not have to cry about the past.
WAITING FOR THE MARKET TO BOTTOM OUT IS LIVING IN THE PAST TOO!

Recession Inflation blah blah blah... if you can afford it now and your current income and future income will be able to support your purchase then buy now and enjoy the upside we are going to enjoy soon once again.

Get in touch with a financial professional , Real estate professional and make things happen

For the US minimum wage history chart click here

FEDS lEAVE RATES UNTOUCHED: Thereby calming the bond market and getting us better rates

Tue, 01 Jul 2008 14:32:10 -0500

Rates started to level off from its volatile ups and downs we had in the recent few months since they start cutting rates.

This goes to prove a point again to the public that contrary to the popular believe that when the federal board cuts rates the so will happen to the mortgage rates.

NO THIS IS A MISTAKE

Rates go up on a scare of inflation

Rates go down when that scare tames off.

In addition to that, bonds and stocks compete for the same dollars. Therefore, when stocks goes up bonds have to go up and compete since when stocks experience growth and momentum money tends to flow out of bonds which is where money for mortgages are coming from.

Bonds however, have a strength that stocks does not have and that is security. Bonds might offer less momentum then stocks in the overall scheme of things but they offer a consistent leveled long term income for the investor. Therefore when the economy is shaky, bonds tend to pick up with the exception to inflation. inflation will kill the desire to own bonds.

Inflation is caused when the dollar loses its value

part of the value of the dollar is how much interest the fed will pay for its investors when invested in the fed bonds. since it is a global market and the euro also sells bonds and so does china. If the euro is paying 4.2% and tour fed is only paying 2% now you tell me who is more desirable?

In Summary

lower rates then our competitor the euro = weak dollar

Weak dollar= inflation

Inflation= higher mortgage rates

Higher mortgage rates= lower Real Estate market!