WAITING FOR THE FED.

Here we go again, all eyes are turned to Bernanke and the market is simply clamoring for a rate cut next Tuesday. It may or may not happen. Today, the Fed injected 13.5bln to help banks' liquidity. Fears of recession triggered by the housing market, stay tuned.
CHANGING THE GAME.
There is a bill in the Senate authored by Schumer that proposes to raise the ceiling of Fannie and Freddie maximum loans from $417,000 to $626,000 for a single family home! This proposal has the effect of changing the jumbo loan parameters. Its passage would alleviate the credit crunch in a segment of the market hit the hardest.
FHA TO THE RESCUE.
FHA secure, part of Bush's plan to help trapped ARM borrowers is in full swing. Under that plan, borrowers who were making timely payments before their interest rates jumped due to the reset and became delinquent as a result will be refinanced under FHA. This is not automatic: the borrowers have to qualify for the new mortgage, i.e. meet the guidelines such as proof of sufficient and verifiable income. Borrowers who bought property using the now discontinued "junk" loans, (no income verification, bank statements, etc...) will not benefit from this program.
With about 2,000,000 mortgages expected to reset, 50,000 of them may go into foreclosure.
HOW ABOUT THE LENDERS?
Lenders are not faring any better: GMAC just borrowed 21 billions to cover its sub prime activities. Countrywide already borrowed 11 bln and will cut 12,000 employees from its payroll. It also received 2 bln from Bank of America. So far this year, 142 lenders have closed their doors. Go to http://www.lenderimplode.com/ to keep track of who will be next.
Bernanke deliver us from the credit meltdown, amen.
SOLUTIONS.
I am open for business, so if you or someone you know needs a mortgage, please ask him/her to call John Palla at 773-562-6972. You can also check my website at http://www.p2funding.com/ where you can see our programs guidelines.

LISTINGS:
3-Flat Building fully rented in Chicago, good investment property, call me for info.

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