Workable Solutions to a National Financing Problem

There have been many blogs discussing and pointing fingers on who is to blame for the subprime collapse; the lenders, loose restrictions, over inflated home prices, rising interest rates and so on. But what there has not been a lot of, is the discussion around a workable solutions for people caught between a rock and a hard place. Opinionated bloggers have been really quick to point the finger, analyze faults and make everyone’s mistake public knowledge but maybe it is just me; once the problem is known the next move is create a workable solution so people can get on with their lives, is this off the mark? I do not think so.

The government, surprisingly enough, has taken action with its FHA Secure program. This particular program and created a lot of discussion across the blogosphere, political ploy tactics is just one of them, and on our blog posting has created a insightful conversation between consumers, mortgage advisors and concerned citizens. Though the government is getting involved with there own program and the Federal Reserve lowering interest rates.

The affects of lowering interest rates has had both, positive and negative, effects on the financial markets. The Inman Blog reports “homebuyers could end up paying higher interest rates even as the Fed continues to cut short-term rates”, full story.

With the financial markets in such an upheaval it is easy to see why so many bloggers jump on the band wagon and point fingers instead of looking for stabilizing economical solutions. Now with all the said what can be done either by the government, financial institutions and/or the public?

Government: The government could spread the assistance to a greater reach of people. This does come close to bailing out people which President Bush said he was not going to do. But if they did bail out more people the recovery time of the financial economy would be shorten, especially here at the ground level.

Financial Institutions: Do away with terms and programs that offer “creative” solutions. I continue to stand by the position that the terms “creative” and “financing” should not be used together. This is one area where traditional and trusted means of financing provides stability as well as security to borrowers. In addition, financial institutions could take a closer look at loan approval criteria and make the process more streamlined and clean up the excess junk that may have contributed to current financial climate.

Public: The first big item is to get current credit blemishes cleaned up and get yourself in the position to qualify for a traditional 30 year fixed. The positive impact for a family that has made it a goal to get into better financial shape will see the benefits for many years to come; it is not limited to the financial position of purchasing a home. Another item for the public is to avoid non trusted or not well established lending institutions. When dealing with major financial purchases consult friends, get recommendations from your REALTORS and interview a few lenders to see who is a good fit for you and your family.

The economical impact of the current situation is not going to be an easy fix but if a well thought out plan is put together, and not kept in political limbo, then the nation can actually move forward. Problems with never cease and with that said; it is not how we point the finger in the time of crisis but how we move through that crisis that sets apart from other countries which maybe in the same boat.