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 Home Loan & Mortgage, Home Buying & Selling, Tips For Homeowners.
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Can I Get a Loan Even After Bankruptcy?
Some people believe that if they have filed a bankruptcy, their financial life is over. To some extent that is true but only when you are not fully informed.
The truth is that bankruptcy leaves a big bad stain on your credit report and if you can avoid bankruptcy then we recommend you should try every [...]
07/03/2008 04:19 PM
No Change To House Prices For May
According to a recent report released by the Land Registry there was no change to house prices for the month of May, with figures showing that house prices were up 1.8% over the year. However, property sales figures remain bleak, with officials from the Land Registry claiming that property sales in March stood at just [...]
07/02/2008 03:16 AM
Should You Go with a Variable or Fixed Rate Mortgage?
I recently got into a discussion with a client about whether he should go with a fixed or variable rate mortgage and I shared with him a copy of a paper that was written by Associate Professor Moshe Milevsky at Schulich School of Business in 2001. The paper is called 'Floating Your Way to Prosperity' and you can find a copy of it and other papers written by Professor Milevsky at http://
06/24/2008 03:44 PM
Credit Crunch: Make No Predictions of What Lies Ahead
From the Oregonian:
There are new signs that the worst of the global credit crisis is yet to come and that banks and brokerages caught up in the market turmoil may lose nearly $1 trillion by the time it has passed. Major U.S. investment banks this week announced yet another painful quarter amid the implosion of mortgage-backed securities and risky credit investments. Regional banks have scrambled to secure fresh capital to stay in business, and by Wednesday there was new talk that embattled investment bank Lehman Brothers might be forced into a sale.
With each passing quarter, Wall Street's top bankers have indicated that the worst of the market turmoil was done, only to face more pain months later. The uncertainty has caused already battered investors to lose confidence in financial companies, and expectations have increased that more layoffs, asset sales and capital-raising will be needed in the weeks ahead.
"We thought this was going to be the kitchen-sink quarter, and we're finding out that CEOs and CFOs still don't have a handle on the credit crisis," said William Rutherford, a former state treasurer of Oregon who now runs Rutherford Investment Management. "We haven't disinterred all the dead bodies. What else is out there?"
The deepening credit crisis could cost the global financial system about $945 billion by the time it's over, according to a report from the International Monetary Fund. So far, banks and brokerages have written down nearly $300 billion from bad bets on mortgage-backed securities and other risky investments.
After reporting largely disappointing second-quarter results, executives at Goldman Sachs, Morgan Stanley and Lehman Brothers still weren't entirely clear when the hemorrhaging will end. David Viniar, Goldman Sachs' chief financial officer, said Monday that March marked "the bottom of the crisis, at least for now" -- making no predictions of what lies ahead.
Remember when $1 trillion in losses was 'at the very high end'?
06/19/2008 03:18 PM
Unemployment Rate Up To 5.6%
From the Oregonian :
Oregon lost jobs in May for a third consecutive month -- the first time that's happened since early 2003 -- as the state's unemployment rate rose to 5.6 percent.
Payroll employment dropped by 3,700, on a seasonally adjusted basis, reaching 1,735,200, the lowest level since October. Job losses hit construction, manufacturing and professional and business services again in May, and spread to the trade, transportation and utilities sector.
But the three-month decline has not come close to the deepest monthly losses in downturns during each of the past three decades. In addition, some resilient sectors of Oregon's economy, such as educational and health services, have protected the state from unemployment highs reached during 2003, for example.
"The employment trends are showing a modest downturn," said David Cooke, an Oregon Employment Department economist. "There are substantial corrections in certain industries -- construction and manufacturing, notably -- and other industries continue to add jobs."
Manufacturing lost 2,300 jobs in May, seasonally adjusted. Construction lost 1,600; trade, transportation and utilities also trimmed 1,600; and professional and business services dropped 1,000.
If not for educational and health services, a sector that added 1,400 jobs during a month when it usually loses 2,100, Oregon's economy would look much worse. If not for strong government hiring, for instance, unemployment would be higher. And if not for recently cashed U.S. economic-stimulus checks, retail trade -- down 3,200 jobs, seasonally adjusted, since February -- would likely be in worse trouble.
06/17/2008 10:26 AM
The fuss over froth revisited
Exactly one week ago, I had the pleasure of sitting on a panel to talk about financial blogs along with Jon Lansner of the Orange County Register and Mark Lacter of LA Biz Observed at the Reuters AdvicePoint Investment Conference in Long Beach.
It was a fun time - one of the quickest hours I can recall with lots of questions from the audience and some interesting give-and-take between the three of us and moderator Ray Fazzi.
The first question was the funniest - a white-haired gentleman in the back of the room asked, "How do you make money on blogs?"
None of us could really answer that question.
Since my badge looked something like what you see below, the subject of the retired Fed chairman and his legacy came up with almost everyone I spoke to at the conference as well as a number of times during the panel discussion.
 So, it was not much of a surprise later in the day when Jon forwarded a link to his mid-2005 column on the subject of Alan Greenspan's "froth" characterization of the then-booming housing market.
It's worth having another look at three years later. It begins...
What in the world is Federal Reserve boss Alan Greenspan thinking when he says there's "froth" in some of the nation's hottest housing markets?
Understanding the word's meaning is critical in this town, where many folks wonder if the wealth created by soaring home prices is a permanent addition to their checkbooks. Well, the wondering is over. We all know the answer to that question now - housing wealth is about as permanent as stock market wealth.
After going on to talk about beer heads and baristas, a pricey gourmet coffee analogy concludes the piece:
Greenspan says he's cool with a national economy dotted with dicey regional housing markets that have been heavily financed with exotic, untested loan products.
That logic works for me only if housing is undergoing a froth-like metamorphosis, where changing tastes make folks comfortable spending far more money than previous generations on old favorites. The Starbucks analogy is a good one.
It's more than just a coincidence that the Starbucks (Nasdaq: SBUX ) share price peaked at about the same time that home prices peaked back in 2006.
I can't tell you how many $4 Starbucks cups I used to see when I slogged away as a software engineer in Southern California a few years ago. Stopping on the way to work for a latte when you could brew a cup at home for about 10 cents never made any sense to me.
 (Note: Starbucks stock would make a fine addition to the S&P Case-Shiller Home Price Index chart series - see government inflation , job creation , revolving credit , and Countrywide stock .)
In a " froth update " earlier this week, Jon looked back at when the mid-2005 "tiny bubbles" characterization was formalized in a Federal Reserve speech and suggested readers weigh in on the matter.
Not surprisingly, the retired Fed chairman fared rather poorly.
Full disclosure: No position in SBUX at time of writing.
06/11/2008 12:04 PM
Fisher: Silly interest rate talk
Does anyone really think that the Federal Reserve is going to be raising short-term interest rates anytime soon? And if so, by anything more than some token amount that will likely have all sorts of disastrous, unexpected effects on markets?
Remember what happened with the housing market back in 2004 when former Fed chief Alan Greenspan began his "baby-steps" campaign? Well, just think how emboldened commodity traders will become when that first quarter-point rate hike comes and the price of oil doesn't drop as expected.
Does anyone really think that interest rates are going to be moving up during an election year with job losses already totaling 324,000 through just five months with what will likely be a massive downward revision to that total before November?
Dallas Fed head Richard " eighth inning " Fisher was talking yesterday like he was a cowboy about to go "round up" inflation with a big lasso.
According to this report from Bloomberg, it's not so much if or when, but how much and how fast rates will be raised.
Any move to increase interest rates to counter rising inflation pressures should be "very deliberate" and gradual, Federal Reserve Bank of Dallas President Richard Fisher said.
"We need to proceed in a very deliberate manner and I expect us to do so,'' Fisher said in a speech today in New York. Fisher said he disagreed with the idea that "we could move less than gradually if the forces of inflation were threatening.''
 The Dallas Fed chief is the only member of the Federal Open Market Committee to dissent three times this year from decisions to lower the overnight bank-lending rate, favoring either no change or less aggressive reduction. Chairman Ben S. Bernanke yesterday said policy makers will "strongly resist" any surge in inflation expectations, delivering his clearest message yet that the central bank is done lowering interest rates.
"You don't want central banks with trigger fingers," Fisher said to the Council on Foreign Relations. "One would expect gradualism."
And you don't want Fed Bank Presidents who imply something that the central bank can't deliver - after a while of talking and not delivering, people start to catch on.
It looks like we're in for months and months of "silly interest rate talk", a phrase that, if memory serves, Chuck Butler at Everbank coined a few years back.
If they really wanted to do something about rising prices and the plunging dollar, they'd take rates back up to at least four percent - the "official" rate of inflation. And if they were really serious about it, they'd take rates up to five percent, six percent, or more - closer to the "actual" rate of inflation.
But there's that little problems of jobs to deal with.
 Now, admittedly, no one really thinks that the Bernanke Fed will wait as long as the Greenspan Fed waited to start raising interest rates back in the summer of 2004 - there was a whole year of job growth back then before short-term rates began rising and they were talking about "deflation" when home prices were rising by more than 20 percent a year in parts of the country.
Ahhh... memories...
That's actually very ironic - today we're talking about in-flation while home prices are dropping by more than 20 percent a year in parts of the country.
Is there some imminent reversal in the employment picture that Richard Fisher knows about that will make the current downturn the briefest of all economic slowdowns following the bursting of the biggest financial bubble in the history of the planet?
Yeah, that sounds >like< a plan.
06/10/2008 06:51 PM
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