About Jasper's Bent Tree

In a Real Estate Transaction there is a buyer, a seller , a buyers agent, a sellers agent, and a Lender. now there does not have to be all these folks but more often than not they are all there. There are also "minor players" like the inspector. They are minor players but can kill a deal.

So all the players march along on the trail to the closing. The agents keep the clients informed and make sure we are all in step with dates and times and things to be done. The clients nervous to the end rely, hopefully, on their agents and generally are in step with the process as they want it to happen.

Then we get to the lender. The lender wants it to happen too but is very often not in step. The lender asks for tons of paper work, and then comes back and asks for more. The lender seems to miss the dates in the contract when the appraisal needs to be done by, as well as the loan commitment given. A "good" lender will actually come to you and say they need an extension.

The lender today is out of step with the transaction in my opinion. Now before you all jump on me I would say that this happen 50 percent of the time. So we do work with good lenders who come through. But here is the point. Until Lenders get back to loaning where they were pre bubble we will never see a housing rebound. When we bought our first house in NYC it took 60 days to close. When we moved to Georgia the lenders laughed that it took so long in New York. Well guess what ? Georgia is now 45-60 days even for loans that are 100 percent no problem.

So what is needed is we all need to get in step. The market was out of step when any one with or without a pulse could get a loan. But now we have moved too far the other way.

Last week I took my son down to the Navy recruiting office where i left him. He was shipped out to Great Lakes for basic. I am proud of him and miss him all at the same time. I am his Italian father. so I say to my wife , I wonder what Joe is doing now? She says thinks like, Oh he is having a leisurely lunch. or depending on the time of day she will say they are probably having diner and a movie.

Now I know she is making fun of me. Hey isn't that part of a spouses job? So have a good thought for son Joe who is serving us . Thanks to all

Today I treated my self to a haircut, no a hair experience at the Old Fashioned Barber Shop in Jasper. This is post number 2 about this great Barber shop. If you saw the classic movie Barber Shop, or the female version with Queen Latifah then when I tell you the Old fashion Barber shop is that experience mountain style you will know what I mean.

The Barbers are great. The coffee is good and the atmosphere is friendly and very inviting. The shop itself is centrally located In Jasper on Church street

There is plenty of parking. Based on the popularity of the shop you will need it. The sign below gives the details. So if you are in Jasper, or heck, if you are in Jasper, or Ball Ground, or Marble Hill, or Ellijay, or even Canton get your next hair cut at the Old fashioned Barber shop . You will be glad you did

I had my hair cut as well as my beard trimmed. Which leads to the second part of this blogs title , How do I look ???

Maybe 2 years ago the Fed stopped buying Treasuries. The run up to the stoppage was that interest rates were going to go up. They were going to go up BIG time. Well the Fed stopped and interest rates went down. In fact at a meeting with a gent from the Fed he said they( the Fed) was as surprised as anybody that rates went down.

For those of us who took economics we all learned about supply and demand. Low demand means that the rate of return has to go up to entice buyers. However this truism seems not to have been the case.

The Fed again has been buying securities and I believe they are due to stop in July or August of this year.

Again folks are saying that rates will rise. But will they? Are we undergoing economic changes, not yet fully understood, that effect rates? It will be interesting to see what happens . What do you all think?

The newest thing in Congress in the area of Housing is the QRM. To me QRM = lets punish the victims. Who are the victims? You and I and every home owner in the country. Lets review.

In the 90's and into the early 2000's a tremendous amount of money found it's way into our country. America was considered a safe haven for funds. Both Greenspan and Bernacki told us not to worry. It was normal for people to want to invest here. But as usual a lot of cash caused problems. What that cash did was create debt. How can cash create debt? Easy. If there is 100k available at good interest rates somebody will borrow it for a mortgage . So there is now a 100k debt. Multiply that by billions.

Billions were invested in the housing market. When you have this kind of money both domestic and foreign pouring in you have inflation. But in our case we had more. We had easing of borrowing rules. We had all kinds of weird and wonderful ways to borrow for those who had no money. It wasn't enough to run up prices. There was so much money that we had to find ways to get people to borrow it. In fact we even had to create instruments to sell off loans . Then when folks started asking questions we created "insurance" to calm the market. And when even that became a problem Merrill created a division to buy these toxic assets from the division in Merrill that was selling them. And of course everybody got their bonuses.

Well the crash came. So who is to blame? The folks on Wall street that created these toxic assest? Maybe the lenders who poured out money? Maybe the folks that created these weird and wonderful borrowing programs? Maybe the Fed who should have stepped in a lot earlier when tons of money was pouring into our economy? No none of these folks are to blame. The blame is being placed on the victims. You and I and everybody that lost their home.

The argument goes you should have known better than to borrow under these terms. That is what we are telling borrowers who could not refinance and ended up in foreclosure. Yet the government of Iceland who has folks with degrees in Economics was going belly up because of their investment in American housing. Some how though folks with High school diplomas here should have known better than economists.

So lets punish the victims. You and as home owners are victims.. The values of our homes have gone down. It is harder to sell. It is harder to make a living in Real Estate. But that's OK because we deserve to be punished while the big banks and brokerage houses make tons of money and pay out big bonuses.

So instead of QRM how about eliminatig ARM. After all that is a gambling type of mortgage. Get rid of it. Get rid of interest only mortgages, get rid of negative equity mortgages. Go back to fixed rate loans where folks need good credit.

People who have VA loans, USDA loans and FHA loans that have jobs are not defaulting. And if they are it is usually because they are victims of this crisis which THEY DID NOT CREATE. They love and want to stay in their homes.

As long as it makes banks more money to allow properties to go into foreclosure we will not see modifications in the numbers we need to stop the slide in prices. We victims will continue to be punished until we look past whether someone is a Republican,or Democrat and vote for people who want to see the victims of this housing crisis, You and I , not be punished anymore.