Home equity loan rates

With US real estate prices still on the way down, most would-be real estate investors are facing issues if they need to refinance a mortgage on a property they were renting out. The mortgage resets are not exclusive to residential buyers and a lot of investors are facing problems also. Refinancing a mortgage is the big issue currently, because, whatever mis-information might be being spread around by the banks and governments, credit markets remain tight.

The home equity loan rates bear no relation to the silly low interest rate the fed is charging, and Bank of America are charging one of the highest rates around – if your credit is good. Those needing to refinance with bad credit can forget about it at the moment.Where this madness will end is anybody’s guess, but the big four banks are now the biggest real estate owners in the US.  They are under pressure not to release their stocks of foreclosed houses to prevent the real estate market from correcting properly. Supply and demand? Forgetaboutit too. If the bank foreclosures hit the market, supply would outweigh demand to such an extent that prices would be so low that any American would be able to afford their own home. Wait a minute, wasn’t there a dream about that?…………

Yes, the great manipulation continues unabated. The massive amount of properties being held by the banks is the only thing preventing prices from correcting, yet still they are falling. This makes the decision to get into property investing rather tricky at the moment, because it seems the market correction is merely being slowed and dragged out. So when to get back in? I have seen deals in Florida where bulk lots of condos have sold for less than 6% of peak prices. And these are completed projects, not part built. The logical best  place to look for a real estate investment in the US is the bank owned properties, but they are hanging on in there using Uncle Sam’s money to keep prices up.