The Bad News Is Everywhere!

The bad news is everywhere!  Store and factory closings, layoffs, and reduced confidence; but allow me to provide some perspective that may surprise you.  Perhaps you’ve recently heard the phrase, “Worst economic crises since the Great Depression”.  Well, I must disagree.

Here are some statistics that may surprise you!  These are numbers from when President Reagan took office vs. today when President Obama took office.  Unemployment: then 7.5% vs. now 7.2%.  Inflation: then 12% vs. now 3%.  PRIME Rate: then 20.5% vs. now 3.25%.

 

People living below the poverty line: then 14% vs. now 12%.  Top tax bracket: then 70% vs. now 35%.  Perhaps it’s not as bad as the press-or even we, would like us to believe!  But with bad news comes some good as well, if only that everything is cyclical.  However, there is a more quantifiable benefit…

Prices of just about everything are coming down due to reduced demand and government efforts.  I’m writing this letter from somewhere in the Texas hill country on my way to Los Angeles, CA.  I’m glad I didn’t need to make this trip back in July as fuel prices alone would have cost an additional $247.  As it is now, thanks to reduced demand, I’m seeing fuel prices around $1.70 per gallon. 

For another example, mortgage rates are near a fifty year low, and you really couldn’t be in a better position if you’re in the market to buy a home.  Let me demonstrate how you can save at least $118,000. 

An average home sale price is about $280,000.  The interest savings of a 4.75% interest rate (available now) over a 6.00% interest rate ( available three months ago) on this side of the loan is over $78,000.  You can save substantial money by refinancing a 6.0% mortgage!  If you’re in the market to buy that home, you can save the interest expense demonstrated above, and the home is now at least $40,000 less expensive than it was a couple years ago.  That adds up to a lot of savings!  In real estate they say, “Location, location, location”.  I say it’s “Timing, timing, timing”.  And the timing is now! 

There will be several thousand active duty military and civilian contractors along with their families coming to our area within the next two years.  That huge influx of people will begin to create housing demand without precedent.  So even if you already own your dream home, this is a very good time to buy investment property! 

People that (get ahead) are the ones that don’t follow a pack mentality; they buy when no one else is buying; they sell when no one else is selling. 

If I can help you or your friends, please don’t hesitate to give me a call or reply to this email.  We’re providing a professional approach to mortgage finance, and hopefully some realistic perspective as well! 

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