To just about no one’s surprise, the U.S. Congress failed to act on a foreclosure prevention measure before closing down for the long July 4th weekend. And, some think the Congress won’t do all that much once the weekend is over, either.

A New York Times estimate is some 55,000 more homes will be in foreclosure by next Monday! Amazing.

Mind you, the bill being considered by the Senate is far from a cure-all: It is voluntary, for one thing, and it would ask lenders to issue new mortgages at a reduced rate of 85 percent of the current price of the home.

By many accounts, then, even passage of this measure would be a drop in the bucket. But a drop is better than a drought anytime.

Could it get much worse? What are you kidding!

Yeah, it could get worse. In fact, it already has.

Evidence:

Since January 1st, stocks have lost $2.1 TRILLION. I don’t even know how many zeros that is?
Last month, the market suffered its biggest June loss since the Depression.

U.S. auto sales are now officially at a 15 year low and dropping.

Even Starbucks is buckling–announcing it will layoff up to 12,000 employees and close down 600 stores.

And, as amazing it may now seem, these are but a few of the latest ramifications of the the subprime mortgage crisis that ignited this global fire.

While there are more vacant homes on the market, credit is so damn tight that fewer and fewer people can afford them, even at such “bargin” prices. In fact, the interest rate on a 30 year fixed mortgage is actually up, making it that much more difficult for a buyer to — well, buy!

In the months ahead, economists fear that credit card debt will strangle more and more people who will then miss payments to the bank or not pay at all.

For some, the answer to this entire problem is a simple one: Fix the housing mess and everything else will fall into place.

But I am not convinced it will be as easy as that.

After all, while we like to talk about this crisis as having been sparked by the mortgage debacle, the truth is far more complex than that. Bank and lender greed, lax government oversight, suspect credit evaluations, dubious exotic investment vehicles–all these and more interacted to bring us to where we are today. No single fix, then, of any single component of this puzzle will solve it.

But you have to start somewhere, so it might as well be with the foreclosure mess. And that is why Congress must come back after the 4th with the pedal to the metal or else witness the further destruction of the global economy as we know—knew?—it.

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Tags: Economy, foreclosure bill, Foreclosures, housing, housing law, recession, senate

The following information is about what the U.S. Senate is up to. If any of this becomes law, it will have a direct and severe impact on my business.
There are very good and honest investors out there and BiggerPockets has been a great place for new & seasoned investors to get together and let others know how to do things the right and honest way.

• Legislation Expected to be Introduced Soon.
• Measure Likely to be Modeled After Minnesota Law,
• But May Contain Additional Restrictions Harmful to Investors Nationwide

February 22, 2008 (U. S. Senate)

Wisconsin Senator Herb Kohl has announced plans to introduce legislation aimed at curbing the rise of ‘foreclosure rescue scams’ - using a model which may include restrictions that could be harmful to all real estate investors. The measure is likely to contain some or all of the following provisions:

• Ban on leasebacks-to-owners
• Ban on upfront foreclosure consultant fees
• Ban on all “subject to” transactions
• Limitations on an investor’s ability to purchase or take an equity interest in a home in default
• Ban on all advertising related to “Saving Homes from Foreclosure”
• Restrictions on real estate seminars, which could even apply to Real Estate Investor Association meetings

Also noteworthy - in the Minneapolis / HennepinCounty area alone, foreclosures have increased more than five-fold since the 2004 passage of the Minnesota statute.)

On behalf of real estate investors at the national level, the National Association of Responsible Home Rebuilders & Investors (NARHRI) is already tracking this legislation. NARHRI Executive Director John Grant says that NARHRI will offer alternative legislation from the Commonwealth of Virginia, which has the support of the local realtors, lenders, consumer groups, and which recently passed the House unanimously.

NARHRI expects to see intense political pressure for passage of the legislation before members of Congress leave in the fall. NARHRI indicates it will be providing updates on this effort as circumstances warrant.

This is a very serious in my opinion. It is very frustrating to know that there are legitimate, honest and good investors, mentors and teachers that will be affected in a harsh way.

Please, spread the word on this to everyone you know in the business. It is our job to protect our business. If we sit back and say nothing, there will be no voices to be heard and this could actually become law.

Thank you!

Tags: bailout, foreclosure, foreclosure rescue, foreclosure scam, herb kohl, housing, legislation, scams, senate

Today is the big day! If you’re reading this and haven’t hit the polls yet, get up and do so!

From PBS:

It’s a puzzle — voter registration in the United States is at an all-time high but voter participation is nearing an all-time low. In the 1964 presidential elections 69.3 percent of the voting age population cast a ballot. In 2002, that number was only 54.7 percent, up 0.3 percent from 1996. The numbers for midterm elections are worse. During the midterm election in 1998, only 36.4 percent of the voting age population made it to the polls.

I have to say that I understand why people sometime don’t make it to the polls. I spent a few hours last night reading through all the material the State of California provided to its citizens. Sadly, while it covered the many propositions that were up for vote, there was something lacking. Less then half of the candidates that were running for office had their positions or even a one sentence bio in the election materials provided.

After conferring with some friends and family, I felt better informed and finished making my choices. I had to take the time to do some research, but I realize that it is my duty to do so. There are two sites that I use to help educate me on the candidates and issues: vote411.org, and smartvoter.org. These are fantastic resources, and I recommend you go through them before hitting the polls.

I realize that all the choices may be confusing, and it takes a fair amount of time to go through all the materials and information you can dig up online, but it is important enough that we all do it.

Don’t just vote for anyone. Do your homework. Do some research. Be informed. The United States has been a model for democracy for decades, and we need to start learning what the rest of the world envy’s us for. Our voice matters. Every individual has the opportunity to make a difference.

I’m disappointed that so few Americans vote, but it is never too late. Lets prove to the world that we care about what’s going on here in the greatest country around. Lets prove to the rest of the world that we care what the United States does around the world. Lets stop complaining about why politicians stink. Lets stop talking about how our government doesn’t properly represent us. Lets prove to ourselves that we can do it. Lets get out and vote . . .

. . . and if you really care, why not start thinking about running for office yourself!

See you at the polls!

Tags: congress, democrat, election, house, polls, republican, senate, states, united, vote