Wake me up when mortage rates fall to 3.5%. Then I will buy a house.

As it stands a $150,000 30yr fixed mortage with 0 points with over a 700 cresdit score, if you can get it is $860 a month. With insane property taxes in most areas you add $350 a month on top of that.

By government definition anyone making under $50k a year would be overexended with a purchase like that.

The pure and total fact is that the majority of young americans have no chance at purchasing a house in the near future unless drastic measures are taken to lower interest rates as low as possible.

First time home buyers should be able to purchase a home at 2% for 30 years. Then the housing market would begin to stabilize. Property taxes also need to be cut in half.

Sorry, but until the wage scales for laborers increase by a minimum of about 30%, with a freeze on taxation at all levels, you just aren't going to see us buying houses for a good long while.

"Unfreeze" the credit markets all you want to. We're still not buying any more bank crap.

"For every action, there is a reaction", right?

As I am approaching retirement age, I tend to view these issues from that perspective.

The retirees who have worked hard and prudently saved and invested portions of their income, rely on their investment income (interests income) to provide for their costs of living. Many, if not most of the retirees, are not in a position to return to work due to health or other problems/considerations.

Recently, the retirees ahve been hit with somewhat of a four fold "whammy": 1) Investment losses due to the FI Frauds; 2) The weakening of the U.S. dollar; 3) the exorbitantly escalating cost of living and cost of health care and medicines; 4) and now the substantial reductions in their RoI - Returns on Investments.

When the mortgage interests rates drop, then the RoI on the Retirees investments drop also.

Personally, I have absolutely no empathy or sympathy for people who attempted to buy homes that they could not afford. Home ownership is not an "automatic entitlement" just because someone lives in the USA. If someone loses more than they can afford gambling in a casino, how is that my resposibility to "make them well" again by subsidizing any portion of their losses. And these people were "gambling" on trying to be able to buy homes that they could not afford.

As for the mortgage rates, there has to be parity as to the value of the money being loaned and as to a reasonable RoI for those who "invest the money that is loaned in those mortgages". Why would anyone want to invest their money in the mortgage industry if it doesn't provide a competitive RoI?

Our parents (I'm 61) bought just enough house to live in because they considered housing to be just another expense to be minimized. The realization that you could use your house as a financial vehicle is what started the rush to buy more house than could be comfortably paid for.

For me it started in the mid to late 70's when inflation was high and housing appreciation was galloping along at about 12% per year while mortgages were hanging in at about 6%. I bought a not of stuff back then and sold a few years later for a handsome profit. Then Paul Volker ended it all when he raised interest rates and mortgage interest rates soared to almost 20% (yes, 20%) and ended the housing boom.

We seem to get in trouble with housing when we forget why we need it. Not as a gamble for appreciation to be flipped every couple of years for a tax free gain, but rather as a home for our family.

ROI? Why would anyone be considering Return on Investment in their home. The only casino in town today is the Job Market. Get lucky you get a decent job, crap out and you get laid off. The only folks looking at the ROI are the banks and investors in these CMO's, collateralized mortgage obligations, now that's a casino these days. Truth of it is the banks sold these investment tools to raise capital, they raise rates to increase their ROI and give a nice return to the investors. Personally I think the whole TARP program is a scam, shouldn't have been done. Freeing up credit is the last thing we should have done. Any companies out there borrowing money to make payroll is simply a failure in the making. What is not being talked about are these retiree's who have lost half their portfolio in the last 5 months. Bailing out financial institutions while letting homeowners who either made a bad decision or lost a job twist in the wind isn't going to fix anything. I've heard it said by these self proclaimed financial guru's who got us here in the first place that we shouldn't reward bad behavior by bailing out these homeowners, but we are willing to bail out the financial institutions for their bad behavior?

It would seem that the banks not refinancing at a lower interest rate to home owners on the verge of defaulting are cutting off their own nose. Would they rather these homes sit empty? It would seem that if these people need to refinance and homes have lost so much of their value, banks would be foolish not to work with these people. Tax payers are tired of bailing out banks. I have lost so much respect for the greedy banks and their CEOs.

Low rates will help spark refis
I just did
http://www.refinancemortgagesblog.com