The government may actually do something here that’s actually going to help us! We can all agree that one of the reasons why the real estate market is so soft right now is excess inventory. Foreclosures are only adding to this problem as banks list and sell distressed properties below market prices. Slowing foreclosure rates would certainly help the real estate markets.The Bush administration has proposed to freeze rates on certain adjustable rate mortgage loans (ARM’s). The idea is directed at subprime borrowers (those who had weak credit at the time the loan was made) who have been making their payments but will unable to if their ARM rate adjusts upward. The proposal would keep the rate from going up for the next five years. It’s a pretty narrow field they are focusing on, but if it stops even some of the upcoming foreclosures it will definitely be a benefit to the real estate market in generally. Not to mention getting some people out of trouble and allowing them to keep their home. A noble cause for sure!
Written by Ken Mascia
Oxford Financial, 248.644.1200
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