BluefoxToday blog : HUD official gives support to financial markets

HUD official gives support to financial markets

Although the Fed's recent key interest rate cut has only a marginal effect on mortgage interest rates, it does signal the financial community that the government is now carefully monitoring the worrisome housing developments. It provides more liquidity to the overall system for one and also assures the banks that Washington seems to be willing to step in if really needed. It's clear that the marketplace is unable to alone navigate these hurricane-force winds.

The Assistant Secretary of the Housing and Urban Development, or HUD, spoke in the same supportive tone the other day. She is part of an obviously broader effort to spread the message that the credit markets are being observed with a keen eye. And sometimes that is what is necessary to calm everybody down. Let the players in the field know that despite their past indiscretions the big brother won't allow the system to fall to pieces.

The HUD Assistant also gave her full support to the subprime mortgage. It's very true that it plays an important role in the housing industry by boosting home ownership. "Subprime mortgages democratize credit," she said and will keep its place in the program mix. That'll be just fine.

Another point she made was that the government will do more to advance financial literacy. That would of course help everyone, including home buyers, but the core problem with the subprime fiasco appears to be lack of personal responsibility. How do you teach that?

 

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Provided by: 

Esko Kiuru
Mortgage, real estate and apartment industry analyst 

www.BluefoxToday.com - syndicated mortgage, housing and property management blog

eskokiuru@gmail.com
My cell: 702-499-1006

Comment balloon 4 commentsEsko Kiuru • September 26 2007 04:15PM

Comments

Hopefully, HUD will not eliminate the DPA programs that assist buyers by having seller contribute to the program for the purchase.  That would not be nice of HUD.
Posted by Rosemary Brooks, The Mother & Daughter Realty Team (BMC Real Estate - 209-910-3706) about 11 years ago

Esko... Personal responsibility is not something we are going to be teaching soon.  To the contrary, we are routinely by our words and actions teaching "it's not my fault".

Having said that, I must reluctantly, admit that HUD is not throwing the baby out with the bathwater.  We are talking about an Industry in trouble here, not a few irresponsible folks that probably deserve what should happen.

Posted by Gordon Sloan, Salt Lake Homes For Sale, Salt Lake Real Estate (Group1 Real Estate, selling houses in Salt Lake City Utah ) about 11 years ago

Rosemary,

FHA is being overhauled now, so let's see what they come up with.

Posted by Esko Kiuru about 11 years ago

Corie,

Hopefully the promotion of the financial literacy programs will be of help.

Posted by Esko Kiuru about 11 years ago

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