The US Labor Department Jobs Report came our for December showing a sobering loss of yet another 524,000 jobs, which totals 1.9 Million in the year’s final four months since the credit crisis began in September. 2008 will truly be remembered for a number of things, but as it relates to jobs, the news is all bad.
The annual jobs-lost is the highest yearly jobs-lost rate since 1945. The back to back months of November and December represent the first time the 70 year history that the numbers have been tracked that there have been back to back months of over 500,000 jobs lost.
The unemployment rate stands at 7.2% but many feel this number is understated due to what they refer to as those who may not be unemployed, but rather are “under-employed”.
According to a recent interview with steel billionaire Wilbur Ross with CNNMoney.com, They count as employed someone who used to have a high-paid manufacturing job, and now is working at a Wal-Mart or a Wendy’s.” According to Mr. Ross, these people now do not make the unemployment rolls but their incomes are remarkably less than they once were.
News article after news article can be found explaining the reason for lower wages for those who are still working as well. But the average hourly work week also fell last month to 33.3 hours, which means that American are taking home less money in their paychecks due to not being on the job as long each week even if they do still have their job.
Many now look to President Elect Obama for a stimulus plan to get Americans working and to get money back into the economy. But the debate rages on as to what is the best way, what will bet the money into the economy the quickest and whether or not the current proposals will spur jobs abroad rather than in America since much of the mill work etc. for the construction and other materials can be obtained more inexpensively in other countries.
Many prominent economists also believe that this approach can take many months and even years to get the money into the economy as projects have to go through planning and approval stages long before they ever begin construction. And what happens to homeowners now?
HUD’s Hope for Homeowner’s program which was unveiled last October has not helped a single borrower to date. The program parameters have been reported as too narrow, many borrowers have complained that all the lenders listed on the HUD website are brokers and that there are really extremely few participating lenders, and according to HUD’s own statistics, there have only been 321 applications and HUD has yet to insure a single loan.
This was a program intended to set aside $300 Billion dollars to assist homeowners to keep them out of foreclosure. Hopefully there will soon be some modifications to the program to make it more available to those who need it.
The stock market has not gotten a break so many have not seen their retirement funds return or have seen their income disappear. There is no program looming on the horizon that will bail out the common homeowner so is there anything that homeowners can look to for relief?
There actually is help for some. Firstly, interest rates are at lows not seen for 40 years. Borrowers who have a current FHA or VA loan may qualify for a streamline refinance of their existing mortgage which requires no income or credit qualification and no appraisal. If you have an FHA or VA loan and you have no more than 1 thirty day late in the past 12 months the loan is quick and easy and, depending on your loan balance and your current interest rate, you might be able to save hundreds of dollars a month on your payments.
There is also the HUD Home Equity Conversion Mortgage (HECM or Heck-um) for senior borrowers age 62 and over. Borrowers who planned well for the future but have been hit hard with the stock market losses, those who relied upon a little help from children who can no longer do so in this economy and even those who now find themselves in a position to where they are having to help their children are looking to this option more and more.
This is a government-insured loan which never requires the borrower to make a monthly mortgage payment and has helped many families through these tough times.
At this time in the economy, everything helps! Now might be the right time for you to lower your payment, augment your income or payoff an existing mortgage and replace it with a mortgage which requires no monthly payments.
About the author of this article:
michael g. branson (ceo all reverse mortgage company)is a mortgage broker who has over 31 years of mortgage banking experience. toll free (866) 705-8567
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