Is Vegas a good barometer for the economy?  We need the bailout.

I always try and look at relationships of non-related items and see if there is a match or hidden correlation.

The drop in gas prices is said to be as much from devaluation of the dollar as it is from less consumption by consumers. This of course is a major downside effect of the federal bailout program.  The more money that the government prints the less value it has.

And for years arm chair economists have used gasoline as a barometer of the economy.

Not so much a barometer but a fact.   As housing goes, so goes the economy.  Each and every time the housing values cycle up which is about every ten years the economy as a whole is doing good.  Each time the economy falters which is about every ten years the economy sinks to new levels of low previously unattained.

Two years ago-hard to imagine that it was only two years- the economy in Vegas was flying high.  Everyone had money.  Speculative investors that had no business buying houses to flip weren't just buying one house they were buying 5 houses.  I wonder how Detroit could have know that we wanted small boxy plastic carbon fiber fuel efficient cars because in Vegas we wanted ultra plush SUV's, trucks or  400 hp semi luxury cars.

Two years ago gas was in the high $3.00 mark, like $3.80.  The average house price for a 1200 sq ft house was around $380,000.

Today gas prices are around $1.84. And that same house is about $184,000.

How about wages?  Two years ago everyone was making great money.  If you were making about $3,800 a month, today you're making about $1,800 a month.

Cars, Trucks and SUV's that were $38,000 two years ago can be purchased for $18,000 all day long today.

High def 1080 dpi flat screen TV's with surround sound and monochromatic magic crystal picture in picture self recording, self play and self destruct features were $3,800.  Today you can buy that same feat of technology for a mere $1,800.

So maybe the economy is not faltering, maybe it is readjusting.  The problem is it does not always adjust across the board.

I love the feed back and response that I get back from everyone when I send these thoughts out. 

A big question I get from many is simply.

Why do we need the federal bailout in housing?  The answer is to adjust prices faster than market conditions can do on their own.  Of course no individual homeowner is being bailed out.  But that does not mean that individuals do not need their house values adjusted.  Bailing out or adjusting housing prices in line with the other economic realities in your life brings you in line with the ability to live within your means and not struggle to live an enjoyable life.

The feds are giving the money to the institutions that cannot fail and are critical to our overall sound economic principals.  With that I agree completely.  But down in the trenches how does it help.  Well it has become apparent to me that the difference between those who have and those who don't is who asks first and takes first.

Loan modifications have become the hottest item in the country and in Vegas.  Why not, we have the most to modify value wise.

Lenders generally do not want to negotiate modifications with terms favorable to the borrower.  I can't fault them for that.  But from a consumer side the borrower that is going to weather this financial storm is the one best prepared.  And that means getting the most favorable terms in modifying your own loan.

The process is becoming easier every day.  But an individual cannot simply call their lender up and get the best deal.  Loans must be challenged.  Discrepancies must found, violations must be exposed, and errors must be corrected.  In bringing these glaring deficiencies to the attention of lenders and mortgage servicers it is easiest to correct or modify the terms of the loan the rate of the loan and the principal balance of the loan.

But it is not easy and must be done by those that are first knowledgeable and second have the legal means and capacity to actually modify loans.  In today's quick buck world of internet certifications we somehow always pass on what's best for the consumer and only focus on how we all make a buck.  But sometimes we create more problems than we solve.

If you interested in modifying your loan or in becoming involved in the world of loan modifications contact me.  It has taken several months for all of this to shake out, but I can say that now I am 100% positive in the approach that we are taking for loan modifications and can assist 100% of all borrowers who need help.

Do you know someone that has been foreclosed on and lost their house?

That house can be reclaimed by them, the loan modified and they can be set upon the path of life again.

With out doing anything the forecast is for 10% of all homes to go into foreclosure.

We are approaching levels where even those homeowners who were fiscally responsible over the years and have not been involved in crazy loan programs are being affected.  As housing prices drop the equity that you have built up by diligently paying off your mortgage is being eroded by the lose of value forced upon you by the decline in market value from foreclosed homes.  Trustee sale prices are on average across the board in the $100 per sq ft range.  Multiply that by your square footage and that is becoming the value of your home.

We have to stop foreclosures to protect the value in our homes as well as the viability of neighborhood communities, towns, cities and states.

The more money the fed prints the lower the cost of consumer items may become.  But there is a direct relationship between your wages, and the value of the assets you have acquired.