Mortgage Discussion for the Panhandle area

Many area agents have called or e-mailed me to ask my thoughts on the current credit crisis. "I do not like it" is the short answer but I will try and sum up what is happening across the country.

First let me state this "subprime" problem is not new. In fact it is a reoccurring ten year cycle in today's credit environment. This is the mortgage industries third time in about 20 years we have made a market correction and large aggressive mortgage lenders went belly up.

This time seems to be the worst of the three, as the cycles before only affected the subprime market. In today's credit crisis everything is affected somewhat including Fannie Mae, Freddie Mac, Jumbo Loans, low document loans with many other programs. So why is this one so bad? Timing is the major factor. Not only did we have some very aggressive credit lending but we also had two other changes in the market. The Interest rates going up and property values going down. Too many American's have adjustable rate loans who need to refinance but cannot due to the drop in property values. They are stuck and if they cannot make payments on the higher rate adjustments they are homeless as well.

We have a credit problem and the FHA reforms is not the quick answer. First of all it is not quick. FHA is a Government program and we will need congress who cannot agree on anything to make changes to the program, That will take forever and homeowners do not have that long. Second of all why is it government's problem consumers are in this trouble? Look at the consumer, Mortgage lender and Mortgage Broker for responsibility. I work with people everyday who need help and with the consumers help we always have found an answer. I would encourage you find a true mortgage professional who can work through this crisis to fund new purchases as well as find ways to help those in the crisis as we speak.

The credit crisis will pass in time. To help the progress please keep an eye open for a consumer in trouble and get them some help with a professional who know how to deal with this market.

Joe Woodall

America's Mortgage Experts, Inc.