Login Registration
Submission Guidelines Recent Approved Articles Featured Articles
Submit Free Article
Home About Us Advertising GuideLines Do's & Don't T & C FAQ Contact us
  Home Real Estate Articles Homes Articles
Articles Category
Arts & Entertainment
Computers & Technology
Food & Drink
Health & Fitness
Home & Family
Home Based Business
Home Improvement
Just for Women
Kids & Teens
News & Society
Online Business
Online Tickets
Real Estate
Reference and Education
Self Improvement
Sports & Recreation
Travel & Tourism
  Member Area
Author Login
Free Registration
Authors From Country
  Helpful Topics
How to Write Articles
Free Early Approval Tips
Why Article Submission
  Best of Webzine
Leader Board
Most Viewed Articles
Top Rated Articles
  WebZine Status
Total Articles -16262
Registered Authors - 2568
Featured Articles - 340
Articles added this
month - 201

Effective Economic Stimulus For Housing


Now that the majority of elected officials serving in Congress and the White House have publicly stated their resolute intent to spend United States Treasury funds to attempt to stimulate the nation’s economy, the ideological debate as to whether it is proper to use taxpayer dollars in support of this effort should now be set aside as moot. It is more appropriate for our nation’s leaders to focus on the most effective, timely and relatively frugal means of achieving the desired end.

Although federal stimulus plans that thinly spread billions of dollars out to various individuals, corporate entities and state governments may appease many of these politicians’ constituents, these quick fixes only serve to temporarily satisfy the immediate monetary needs of the recipients and fall well short of halting the downward spiral in which our economy is imprisoned.

The bandage approach to fiscal inducement will only lead to further and larger federal expenditures in the future, all the while increasing the likelihood that rampant inflation will be added to the mix of economic problems with which we must grapple.

Instead, a more significant and concentrated infusion of these precious funds into the core cause of the crisis should be instituted as quickly as possible to prevent this seemingly endless domino effect from further contaminating our public and private sectors. Remember, the majority opinion is dictating that the money will be spent, so now we must ensure that it is used effectively.

Also recall that this dilemma started in the housing market and the vast majority of economists and analysts agree that a turning point will not surface until housing prices stabilize and the financial institutions that make loans secured by housing can recover.

Recent piecemeal attempts to stimulate both the housing and financial industries through interest rate reductions, tax deductions, foreclosure leniency, and purchasing troubled bank assets will not prevent future defaults and foreclosures from further deteriorating housing values and bank balance sheets. Unfortunately, this reality is becoming clearer with the release of each housing and bank earnings report.

Without healthy banks, businesses will be unable to obtain adequate financing to continue existing operations, which will lead to more job losses and ultimately more foreclosures. Increased foreclosures leads to more bank owned properties for sale on the market, thereby increasing the inventory of houses for sale and decreasing home values. Real estate is the security for most bank loans, and when property values decline, so do the values of the banks themselves. Sound familiar? It should, as this pattern is now likely to repeat until forcibly halted.

The infusion of money into banks is actually the correct course of action, it just needs to be done in a more specified manner and in greater initial amounts to prevent needing to infuse much more in the future. Under the Troubled Assets Relief Program (TARP) often referred to as a bank bailout, the government purchased troubled loans and securities from lending and investment institutions. But, the hundreds of billions of dollars spent were used up far too quickly as entire loans were purchased, not just the “troubled” portions of the loans.

For example, a homeowner may owe $300,000 against a home now worth only $200,000, leaving only the difference of $100,000 as the troubled portion of the bank’s asset. In this hypothetical instance, if the government were to just relieve the bank of the $100,000 portion, the government’s allotted funds for economic stimulus could go three times further by not having to purchase the entire $300,000 loan.

Plus, the TARP program does not prevent foreclosures since the government’s purchase of these loans merely relieves banks of having to foreclose and take the loss. Instead, eliminating only the troubled portion of the assets allows homeowners to stay in there homes since their principal loan balance is reduced and ultimately prevents more foreclosures from saturating the market.

Like this article..? Rate it here:  Votes | Average: 1 out of 5  Votes | Average: 2 out of 5  Votes | Average: 3 out of 5  Votes | Average: 4 out of 5  Votes | Average: 5 out of 5     95 votes, average: 4.93 out of 5    
About Author
Articles Stats
  Published Date - February 13 2009
  Total Views - 2416
  Total Votes - 95
  Average Rating - 2
  Comments - 0
  Mr. Brian S. Icenhower
Brian S. Icenhower, Esq., BS, JD, CRB, CRS, ABR, a California Association of Realtors Director, practicing real estate attorney, a real estate expert witness and litigation consultant, a prosecution consultant of Tulare County District Attorney Real Estate Fraud. He may be contacted at bicenhower@icenhowerrealestate.com, or www.icenhowerrealestate.com
Particular Article
Author Article
  • Benefits of Precast Concrete
  • [2011-09-01 ]
    Precast concrete, an extremely well-organized, practical technique of concrete construction makes good-looking buildings probable at a price that rivals even the most useful industrial building. Read More...
  • Canada Most Thrilling Destinations
  • [2011-08-04 ]
    Canada is one of the most thrilling travel destinations in the world. Canada consists of ten provinces and three territories. Read More...
  • Mississauga Top 4 Destination to Visit
  • [2011-08-04 ]
    Mississauga is the sixth main city of Canada. Situated in the region of Canada, this city is presently east of Toronto and the heavy time from Toronto to Mississauga is approximately twenty five minutes. Read More...
  • Current Real Estate News and Highlights
  • [2010-10-19 ]
    Some current real estate issues coming across my desk. First, as we all are probably aware, credit has been extremely tight the pasts few years, especially for borrowers in the jumbo arena. Most cre Read More...
  • Don’t Wait to Sell Your Home in a Down Market
  • [2010-09-21 ]
    I understand that in reading this you are thinking that I’m a bit of a broken record on this topic, but I feel compelled to keep driving this point home as I find myself in conversations with folks every week…folks that want to move but feel they must wait until the market rebounds. It’s the classic scenario of homeowners that want to sell and buy another home, but can’t past how little they’ll get for their current house. Read More...
  • Finding A Perfect Living Space In Dallas
  • [2010-06-25 ]
    Dallas Apartments - Search apartments for rent in Dallas Texas on dallas-apartment.com! Apartments, Lofts & Townhomes available with up to 3 months FREE rent. Read More...
  • Kitchen Trends in 2010
  • [2010-04-19 ]
    It’s the most important room in the house folks. I’m talking about the vast majority of buyers as well as home owners who simply want a nice interior. A clean, updated kitchen offers the biggest return on investment when selling your home and is a great comfort for those who choose to stay put and enjoy it. Read More...
  • Enjoy tranquillity and peace at this beautiful Bodrum property
  • [2010-03-30 ]
    When it comes to tourist destination Bodrum property stands first in the list. All the major cities of Bodrum property are gorgeous and wonderful but the Yalikavak is the best of all. Read More...
  • Relocate to Pacific Grove California
  • [2010-01-13 ]
    Whether you\'re looking to visit or relocate to California, Pacific Grove may be a good place to start. Located in Central Coastal California, Pacific Grove is a quaint Victorian community. Read More...
  • Find Your Coastal California Home on the Monterey Bay
  • [2010-01-05 ]
    Picture yourself with a hot cup of tea relaxing on your deck that overlooks the Pacific Ocean, watching the sunrise or enjoying an afternoon walk through the gardens. Read More...
  • Enhance your comfort with Dallas Apartments
  • [2009-12-18 ]
    Apartment in Dallas are most fashionable apartments in whole of the Dallas. Dallas is giving you the chance to boost your career with opportunities provided by Dallas. Read More...
  • Bathroom Remodeling — A Key Factor in Home Improvement
  • [2009-12-13 ]
    Bathroom Remodeling – Extreme Makeover Home Gives You a Complete Bathroom Remodeling Project Including Bathtub, Steam Shower, Sink, Faucet, Shower, Vanity and More ! Contractors are Expert in Planning Read More...
  • Life in Dallas and Carrollton Apartment
  • [2009-12-10 ]
    Carrollton apartments also have good parks and recreation facility which helps its residents to relax a bit and give them a place to hang out with family and friends. For the bookworms and all avid readers and learners there are good excellent libraries to subscribe to. Read More...
  • Maximize Your Investment with Phoenix Rental Property
  • [2009-11-25 ]
    Since many years, people are taking interest in property business. Today property is one of the best ways for investing your money and earns profits. Read More...
  • Convert Your Property into an Income Generating Resource without any Hassle
  • [2009-11-21 ]
    There are a lot of factors that made the rental business successful despite the economical conditions. The benefits associated with the residential real estate are numerous Read More...
      Submit Your Articles - Submit Quality Articles - Quality Articles Submission  
      WebZine Articles (webzinearticles.com) is a registered trademark. All Rights Reserved. 2011