Scary Times and Its Not Yet Halloween
July 14, 2008
For those of us who are addicted to following the financial news, July has been a scary time. What with the stock market declining, Indy Mac being taken over by the FDIC and the news reports that Freddie Mac and Fannie Mae are on the verge of insolvency, one could really panic. My recommendation is "Don't panic". As I heard several commentators on Bloomberg News say this past week, both Freddie and Fannie have billions in reserves. While they have much more than that in loans, not all loans are failing.
The proliferation of news and the constant bombardment on radio and TV about the credit crisis, tends to create panic. For homeowners with high loan to value mortgages, concern is valid. To me, the bright side is that because there are so many borrowers caught in the same money crunch, the federal government as well as the lenders are hard at work to find ways to prevent massive defaults. If you are one of the borrowers caught in the crunch, don't put your head in the sand. Contact the lender or perhaps better yet, contact a real estate agent who may have contacts that can interface with your lender.
This will be a time to cut back on expenditures, but weathering the credit crisis and keeping a place to call home will be worth it in the future. Just ask some of the upside down homeowners from the last downturn.
For those of us who are addicted to following the financial news, July has been a scary time. What with the stock market declining, Indy Mac being taken over by the FDIC and the news reports that Freddie Mac and Fannie Mae are on the verge of insolvency, one could really panic. My recommendation is "Don't panic". As I heard several commentators on Bloomberg News say this past week, both Freddie and Fannie have billions in reserves. While they have much more than that in loans, not all loans are failing.
The proliferation of news and the constant bombardment on radio and TV about the credit crisis, tends to create panic. For homeowners with high loan to value mortgages, concern is valid. To me, the bright side is that because there are so many borrowers caught in the same money crunch, the federal government as well as the lenders are hard at work to find ways to prevent massive defaults. If you are one of the borrowers caught in the crunch, don't put your head in the sand. Contact the lender or perhaps better yet, contact a real estate agent who may have contacts that can interface with your lender.
This will be a time to cut back on expenditures, but weathering the credit crisis and keeping a place to call home will be worth it in the future. Just ask some of the upside down homeowners from the last downturn.
posted by shirley harry at 8:21 AM
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