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There is a lot of buzz in the mortgage and real estate market. Home sales are up and large corporations are talking about an end to the recession. There are some concerns, especially when the stock market is up 8.6% (over 1000 points) in the month of July, the largest gain in 20 years. Rapid increases in value can often be false security as more and more people jump onto this fast moving train. So this week we focus on concerns with the market and how to keep this train from derailing.

1. Why Ben Bernanke’s Incomplete ‘Exit Strategy’ Could Lead To A Decade-Long Downturn
   

   Break up all the big banks and create a greater number of highly localized, community-centric banks. Let community and regional bankers securitize pools of mortgages using transparent “conforming” disciplines.

2. Unemployment spreads distress in U.S. home loans
   

   Mortgages have failed the fastest in the areas with the greatest overbuilding, purchases by speculators and reliance on riskier loan products to improve affordability.

3. Why Isn’t the Gov’t Mortgage Program Working?
   

   …servicers aren’t modifying loans because it doesn’t make business sense to do so. The Post highlights a study by Federal Reserve economists making that argument. Meanwhile, a Bank of America spokesperson told the Journal that many people seem to think they’re eligible for aid when they’re not: “Given widespread public mis-expectations, a significant percentage of borrowers seeking Home Affordable modifications under the imminent-default provisions will not qualify.”

4. Would you buy a mortgage from a car salesman?
   

   He then said I was foolish for continuing to pay my mortgage at my current rate. I’d be better off not making my monthly payments, then demanding a change in terms, he said.