This is not just a housing or interest rate problem. This is a 6 years of expansion based on debt problem. This is a false wealth problem. It's an excessive spending with leveraged debt (bad debt at that) problem. It's obvious our government and our citizens are spending more than they bring in. It's really an export vs. import problem. Lowering interest rates won't help, it will only cause inflation which will make it harder on the struggling consumer/homeowner. People won't be able to refinance their mortgage resets if the house is worth less than the amount they need to mortgage. This debt expansion problem caused us all to believe we were wealthier than we really were. As the housing and stock market bubbles grew we thought we were doing well, so spending came easy. Now as these markets correct back to their true values it hurts. We want to avoid the pain, the loss of imagined wealth. The only true way to solve our economical problems is to tackle the huge deficits, bring back factories and jobs, then export more than we import. Then once again begin saving and have true wealth.

The proposed remedy sounds like mission impossible: bring back to the post-Great Depression practices of my parents and theirs. Credit is here to stay, notwithstanding its wholesale misuse, particularly by the so-called sophisticated scions of Wall Street. We all need to take our licking and perhaps go to bed without supper.

All cities are NOT below 1992 prices. Maybe 2002, but not 1992. If that were the case in metro DC area, we surely would be in the deepest depression ever seen. Someone needs to check their facts.

David, Credit was available and prevalent before the "Great Depression". That was one of the things that caused it. Like today back then there was a great disparity between the rich and poor so to keep the economy going the rich extended plentiful, easy credit to people to buy radios, seeds, homes, etc. Then a drought came and people couldn't pay back these loans or for their homes. Then all the people who invested in the stock market (at the time it was many people because again they took advantage of cheap credit and bought their stocks on margins of 10%) when the stock market crashed all these people couldn't pay back those margin calls. Thus the long dreaded depression. They didn't have credit cards back then but they sure had cheap abundant loans and that's what caused the problems then and now. They got out of that mess by working hard and exporting more than they imported and we boomed once again, and it was a real boom based on real wealth. We were the envy of the world. Yet people don't always learn from history and so history has a habit of repeating. Now again, disparity of incomes, cheap loans (credit), and inability to repay them. A society and government that spends more than they make. People buying stocks on margins, margin calls coming due..................Do a search on "The Great Depression".................Then do a search on 2008 Depression. You'll find DeJa Vu.

Most people do not get educated about the financing or purchasing of Real Estate. There are specific loans for ones who are looking to benefit in a future sale that are not meant for primary residences. Your Mortgage Specialist should be well educated in finances including credit cards, and the truth is Banks do not want to educate people and most Brokers just want to make a sale to get a paycheck. Provident Mortgage Group www.iprovident.net decided long ago that it would not service loans. The big name companies you see advertising only want you to think you are borrowing from them. The fact is they sell the loan and keep the servicing rights, better known as collecting the payment. They get paid for that and the late fees if any. Provident Moprtgage Group www.iprovient.net wants to focus on what the client needs and what they can afford. That is how they can keep going because all of their business is referral based. There is even free information from that site and no pushy sales people.

That is why I say that Education is KEY. People need to know that what they want and what they need are two different animals. Big business has handed out credit like it was much needed water and the bait was too much. Now is the time for people to get their act together and get educated in finances. One free source is http//www.iprovident.com

No hassles just good old fashion know how.

Sorry that should be http://www.iprovident.com