Don’t Believe The Gloom & Doom

How Big Is the Sub-Prime Mortgage Market?

Not very big at all।By Jerry Bowyer

— Jerry Bowyer is an economic advisor to Benchmark Financial Network and the author of The Bush Boom

Thanks to Howard Arnoff for sharing this blog!

Some highlights:

"Currently there are about 44 million mortgages in the U.S., and less than 14 percent of them are sub-prime. And only about 13 percent of those are late on payments, with the majority of late payers working through their problems with the banks.So, all in all, when you work through the details and get down to the number that really matters, only about 0.6 percent of U.S. mortgages are currently in foreclosure. That’s up a hair from roughly 0.5 percent last year. That’s it."

Please read the entire article with a very cute Rain Man analogy.

RETIRE LATER, BUY THE HOUSE NOW

With prices in many areas at a low ebb, baby boomers should consider buying their retirement home now, even if they’re still years away from actually moving, allowing renters to pay the bills for now। Here’s some advice for people considering this strategy:• Shop carefully. Buy a home that can be rented for a rate that, after tax considerations, covers the mortgage, real estate taxes and insurance. • Study housing trends. Ask the local or state planning department for demographic and economic data. The information can reveal facts that will influence whether or not to buy. For example, big companies going out of business or military base closings can be bad news. • Don’t forget maintenance. Property managers usually charge a percentage of the monthly rent. Family members may do the job for free but could be ill equipped to make repairs. • Consider financing. Boomers with sufficient equity in their current home can tap it to either buy their retirement home outright or secure a much lower mortgage rate compared to the loan rate usually charged to buyers of investment property.Source: The Washington Post, Belly L. Kass, Esq. (08/11/2007)© Copyright 2007 INFORMATION, INC. Bethesda, MD (301) 215-4688