My Financial Healthcheck

Home sales contracts spiked 32% as first time homebuyers try and take advantage of then was to be an expiring tax credit.  October was the 9th consecutive month of increases for the number of signed contracts.  Private residential construction spending went up 3.9% during October also.  The only problem will these continued incentives is what will happen when they finally expire, we can’t continue to pay for these programs with what the U.S. debt is at.  The FHA is continuing to tighten their guidelines for getting a mortgage, higher credit scores, greater reserves are being needed to qualify.  Almost 90% of FHA purchase loans made between January and August had a down payment of 5% or less, if home prices continue to decline these loans will be under water and have a greater risk of default.  Currently, FHA loans comprise more than 30% of the entire home-loan market, FHA could become the next subprime mess.   New Century executives have been charged with fraud, they were one of the biggest sub-prime lenders. and are now bankrupt.  Mortgage rates for the last week of November and first week of December were at near yearly lows with a 30 Year Fixed being in the 4.75%-4.875% range.