Paul McFadden Mortgage Loan Officer Bellevue Washington Home Loans

Hi all: I just finished watching Barney Frank in an impromptu news conference talk about how the negotiations for the $700 billion government bailout had broken down. Frank claimed that conservative Republicans walked out after adding pieces to the President's bill that made it unacceptable.

It appears there's more work to do. The biggest holdup is who pays for this bailout? The bill as originally presented would have us (think taxpayers) footing the bill. Some lawmakers would rather have the banks pay for their follies since they're deemed to be at fault.

I still think a deal will be brokered but perhaps for less money (Chairman Paulson has already agreed in principle to a tiered payout based on need) and not all on our backs. In the mean time, expect Wall Street to fall precipitously tomorrow unless they can work something out before the market opens. The wild ride continues. I just read Wa. Mu. will be acquired by JP Morgan. Wow! What a year. And I thought last year for our business was interesting. Stay tuned. As always, I encourage your thoughts. Have a nice evening!

Paul

I'm curious if you feel the government bailout of Fannie Mae/Freddy Mac/ AIG, etc., etc. will really help. What do you think? I think something had to be done. But being a free-market guy, I just wonder how much it's going to cost you and me.

Granted. we may have been headed for panic in the streets and this wouldn't have been good. I'm glad someone is finally recognizing the seriousness of the situation. And with the stock market down almost 400 points again today, it's becoming increasingly clear we've got a way to go.

I still think we'll turn the corner sometime next year. It was always a matter of digesting all the "kool aid" (as some of my esteemed colleagues refer to it) we drank. Be sure to weigh in with your thoughts. This is definitely a live one that won't be going away antime soon.

Paul

Hey all: Last Thursday I had the opportunity to attend Zillow.com's first ever Open House for real estate professionals. It was held in Seattle at their corporate offices downtown and allowed them to showcase the services they offer to real estate professionals as well as the public at large.

I came away impressed. I knew some of the presenters personally as they had helped me with questions I had about Zillow Mortgage Marketplace. The one thing I took away from Zillow's Open House is their honest intent to help. I believe their customer service is top-notch and they're willing to learn. Initially I thought their home valuation tools were rudimentary. So what did they do? They listened and tweaked it. In the breakout classes they taught, I was impressed by the discussions that cropped up. Several of the attendees were seasoned real estate professionals who are seeing Zillow help them in their business.

Thanks Spencer, Sara, David, and Rich. I think you're doing a great job. I'm not sure any of you have a background in real estate but you do understand great customer service. I look forward to your next party too!

Good afternoon: I was just reading about Wa. Mu. and how they will either be allowed by the Feds. to raise additional capital or be sold piecemeal to the other banks left. What a turn of events! Just a week ago Wa. Mu, along with AIG, claimed they were sufficiently capitalized. I understand why they would say that as no one wants a run and panic in the streets. My question is at the end of the day, will there be anyone left to turn the lights off?

I think there will be. There are some financial institutions out there that are strong (think Wells Fargo, for example) and will survive. The rest of the landscape will consist of mergers and failures at this point. I believe we're near the bottom. After all, what else could fail or go wrong? Now, the recovery can begin. It won't be swift and it won't be pain free, that's for sure. In our industry, the wreckage has been of titanic proportions. It stands to reason it's going to take a while to dig out.

I'm interested in your thoughts on this. I think a majority of people are scared right now. Scared about their jobs, scared about their money, just plain frightened. Our message should be that we will carry on and emerge on the other side better for it. All is not doom and gloom. Every day people prosper. We are a resilient lot and will endure. Have a great day!

After reading about the collapse of two of Wall Street's most venerable firms (Lehman Brothers bankruptcy and Merrill Lynch's takeover by Bank of America) followed by the Dow being instantly down over 300 points, you have to wonder what's next. It's becoming obvious to everyone that this economic meltdown that started in the housing industry is going to go on a while longer.

The first thought is that mortgage interest rates may improve as investors seek the safety of bonds. This, as we know, really hasn't happened as it should (lenders are building in risk in their pricing) and I'm not sure it will now. Mortgage interest rates came down to 5.5% on a 30 year fixed O.A.C. recently which is pretty good. And with the Presidential election a mere 7 weeks away, I don't expect much movement on rates. There is a tremendous amount of uncertainty these days and only time will correct it.

I expect some time next year for our market to start improving. There are pockets of the country right now that are starting to recover. The bottom line is the consumer needs to return to the marketplace. And he/she needs to feel better about the economy before buying homes, cars, boats, etc. I think once a person gets comfortable with their own situation (it's funny how Presidential elections are always based on the economy in the end), we'll see better times.

All is not doom and gloom. I just think everyone is running a little scared. With our financial institutions in so much trouble, expect the next year or so to have more turmoil. But after this, we'll have a nice recovery. For those of us in the real estate industry, hang in there and keep reminding yourself people are always buying real estate. Have a great day!

Paul