Some people like to say that things are never as good as they appear or as bad as they seem. This kind of talk always reminded me of the kind of wisdom you might hear from a loving grandparent, who by virtue of their age and years of experience can calmly look back at the bumps and travails along their long, well-traveled road secure in the knowledge that none of the potholes matter too much in the end. The problem for those of us that aren’t card-carrying members of AARP is that we are somewhere in the middle of that bumpy, treacherous road and a safe and sound arrival at some point and sometime in the future is anything but certain. Where was I? Oh yes, the wisdom of my Grandma aside, things aren’t always as they appear. No kidding, so what does this have to do with interest rates and mortgage rates? Well, mortgage rates continue to fall to levels not seen since cavemen and cavewomen were out shopping for mortgages for prime real estate on jagged cliffs somewhere in western Nepal circa 10,000 A.D. So what’s wrong with that you ask?
Well for one thing, interest rates don’t fall just because it happens to be a good thing for people who need to or want to borrow money. They generally fall because of lower inflation expectations, which in the case of present economic conditions means that they are falling because the economy is simply that bad and that there is no reason to believe that anything will change for the good anytime soon. Indeed, the rate on 15 year fixed mortgages has dipped under 3% for the first time since, well, as noted above a long time ago if ever at all. Rates for 30 year mortgages are also falling to or below historic levels with recent quotes for a 30 year mortgage coming in at 3.75%. These rates mark the fifth week in a row that interest rates on home mortgages have fallen. Last year at this time the rate for a 30 year fixed mortgage stood at 4.55% while that for a 15 year mortgage was quoted at 3.74%, both of which at the time seemed to be bargains, especially when compared to historical rates.
There is no doubt that lower interest rates are a good thing, in fact a great thing, for consumers and homeowners. It goes without saying that lower monthly payments for things like variable interest rate credit card debt and mortgage payments is perhaps the biggest boost to the overall economic health of most households as more funds are freed-up to pay down outstanding loan balances or put toward other types of consumer spending, which in turn aids the overall economy. But, (you knew there had to be a “but” in there somewhere right?) despite the historically low mortgage rates being posted by many banks, these same banking institutions are grabbing their purse strings tighter than a dislodged mountain climber clings to a safety rope. The requirements to borrow money are now so tight and individual credit ratings so battered due to the effects on their finances in the wake of the recession, that few borrowers are able to take advantage of these lower borrowing rates.
On another level, the lower interest rates along the entire yield curve also reflect and are symptomatic of an ailing economy. Market insiders will argue that near zero interest rates at the front of the curve are the doing of the federal government pumping liquidity into the financial system faster than BP pumped crude oil into the Gulf, and they might be right. However, federal bankers have little control over the longer end of the curve, where rates are falling to levels not seen in most everyone’s lifetime. If the economy had any steam at all and businesses were putting pressure on lenders to borrow money for their companies, the overall level of interest rates would be on the rise. The fact that they are at low levels and still falling isn’t the best news for the economy, though at first glance it would seem to be the case.
The example used to illustrate the problem associated with low interest rates is always Japan, which after its financial bubble burst saw interest rates decline to near zero, where they remained for almost ten years due to the horrendous state of their economy. The situation is known in economics as The Liquidity Trap, an economic quagmire in which government injections of liquidity (free flowing capital) do little or nothing to stimulate the economy. The trap is caused, or created when people simply hoard excess liquidity (cash) because they expect even worse conditions to follow the present calamity they are experiencing.
The U.S. economy has not reached the point of being in a liquidity trap just yet, but if the job market does not improve, and should hundreds of thousand of more homeowners be forced to declare bankruptcy and their homes move into foreclosure, the liquidity trap may very well be the next dire consequence of the greed induced financial meltdown that began in 2007.
Lower interest rates are a good thing when the economy is ailing. And there are signs that businesses are starting to borrow money for expansion and new hiring etc. However, while the banks are able to feast on cheap, if not free capital, and put that capital to work in financial markets games similar to those the precipitated the market collapse, we may never pull out of this problem and the Japanese example could become our reality. No one can force the banks to free up capital and in fact it will take some leadership on the part of one of them to set an example for the rest to follow.
One of the important ways that a family can enhance the safety and behavior of their new family pet is to consider official classes that will teach the dog proper behavior soon after the puppy is brought home. A provider like Jersey Shore Dogs would be able to ensure the family would know best how to help the dog improve its behavior over time by making sure that lessons on a regular basis were obtained. Anyone looking at the best way to train a puppy would need to know that repetition and positive encouragement would be important.
Insurance rates are particularly variable and it's not unexpected at all that a person's insurance rate might end up increasing during a policy renewal. Sometimes truck insurance will go up based upon factors outside the control of the driver and will be the result of new laws or policies taking effect in their state. Each state has a governmental body that sets insurance rates and sometimes they go up because of changes to the average rates set by the government. Unfortunately, there's usually not a lot a person can do to fight against these policy changes as they are implemented statewide.
The housing market collapse has been one of the most significant and catastrophic casualties of the financial crisis. Many analysts and market experts will look back on this particular recession and point to a financial market bubble that eventually couldn’t hold one more molecule of hot air and as with other market bubbles, it blew up in spectacular and devastating fashion leaving behind shocked and wounded markets and people. These same experts will probably also note that most of the hot air filling this bubble was put there by the housing market and everyone associated with it. From bank lenders, mortgage bankers, Fannie and Freddie Mac, and the legislators and barons of Wall Street that all profited from filling the bubble, anyone that had anything to do with the housing market made money, and then many lost it when the bubble burst. Therefore it only makes sense that when the financial markets collapsed, the sector of the economy to take the hardest hit would be the one that contributed most to the problem, which in this case was the housing market.
Now, some four year later, the economy is only now starting to crawl out of the ditch. However, the housing market remains a problem for the overall economy and the subsequent effects of the market collapse on the labor market, along with the devastation to the housing market, are making it a very slow and painful crawl out of that ditch. And where housing is concerned, the number of homes that were forced into foreclosure as well as those still waiting for the process to get around to placing them in foreclosure remains one of the biggest drags on the economy overall, and the housing market in particular.
Each state has its own laws and process for foreclosing on a home and to some extent the federal government tried to step into the process to help homeowners avoid foreclosure just after the full extent of the recession was being felt across the country. The federal governments efforts aside, each state, along with the bankers operating in those states, have been processing the paperwork on foreclosed homes virtually non-stop since 2008; non-stop that is until several states, whose legislators were pressured from citizens groups and federal watchdogs, were forced to re-evaluate the foreclosure process and in doing so have slowed down the pace at which homes are moving into foreclosure. New York is one of those states where it is said that banks that were having trouble dealing with bogus foreclosure paperwork now have another issue to deal with when trying to place a home into foreclosure.
The Obama Administration appointed New York State Attorney General Eric Schneiderman to head a new task force that is charged with investigating mortgage fraud, part of which involves homes being foreclosed on based on faulty or fraudulent information and paperwork. During the course of their work Mr. Schneiderman’s task force found enough evidence to file suit against three major U.S. banks while accusing them of using an electronic data base to come up with phony documents that they subsequently used to move ahead with foreclosures. The banks named in the law suit are Bank of America, Wells Fargo, and JP Morgan Chase, as well as MERSCORP, the corporation behind the Mortgage Electronic Registration System (MERS). Their system was created back in the mid 1990′s as a means to keep tabs on mortgage ownership. Anyone that has a home mortgage knows that the bank that originally lends your the money for your home is rarely the bank that you continue to make payments to along the way as banks will bundle these loans into larger financial products and sell them to other financial institutions. MERS was a system used to track who owned the loans as they moved from one bank owner to the next.
This system is now responsible for over 13,000 foreclosures being filed against New York homeowners but according to Mr. Schneiderman, MERS has no legal authority to carry out such actions. The case being made against the banks and MERS could very well turn out to be a test case for the rest of the U.S. and one that might set a precedent for the way in which banks and mortgage holders go ahead and foreclose on homeowners found to be delinquent in making their mortgage payments. If nothing else, the entire process will be slowed considerably while banks go back and double check to make sure that they are following correct procedures in foreclosing on homeowners and that the paperwork and documentation that they are using as the basis for these foreclosures is valid, completed properly, and verified as to the exact details surrounding each case.
It is obvious that Mr. Schneiderman is not a fan of the MERS system based on his recent comments indicating that MERS was created by the banking and mortgage industry as a means for those institutions to evade county recording fees and to avoid the need to publicly record mortgage transfers while facilitating the quick sale and packaging of mortgages into other financial products on a large scale; a financial market assembly-line of sorts.
The MERS system has been the subject of a number of lawsuits in other states as well as New York with Delaware also filing suit against them while Texas, Michigan, and Kentucky lawmakers are trying to collect millions of dollars of unpaid fees from lenders who leapfrogged over these state’s systems of tracking recording and transfer fees.
No matter what the federal government does the banks have the means to bog them down in court forever. They pull all the strings and lawsuits like this are mere annoyances to them. On the other hand it is refreshing to see that the government is indeed taking up the fight for the poor bastards that are trying to keep a roof over their families’ heads while dealing with a ravaged economy and more than likely, unemployment.
One of the general methods of timing that is in use at the average apartment complex is going to be related to the sort of notice that tenants are required to offer their landlord or leasing company in advance of their departure from an apartment. By utilizing the best tenant screening services, a leasing company will usually be able to confirm whether a tenant they are deciding upon has ever left an apartment home in the past without offering their prior apartment's management company the right amount of notice that they were departing and likely to vacate at a certain time.
One of the primary reasons why some individuals are unsafe in their own homes when they are older is not necessarily that they can't get around, but that they have to have various medical issues taken care of on a regular basis and getting to the doctor frequently just isn't something that's easy to do. This is why looking at Long Island elder care is a good idea because often there are various types of medical issues that can be taken care of in the home by a trained home care professional which reduce the number of times someone has to go to the doctor.