Consumer Confidence: Worst Since '92

A key measure of consumer confidence dropped in May to the lowest level in 16 years, as Americans grew more concerned about their jobs and more pessimistic about business conditions. The index has now declined for five months in a row.

The Consumer Confidence Index is a weighted average of where consumers feel the economy is right now, and where it is headed - or the Present Situation Index and the Expectations Index.

We'd love to know your opinion.. your "consumer confidence level." Tell us what you think by clicking the comment link below.. and sounding off about YOUR Confidence Level in the current economy. Don't worry, your privacy is 100% protected. Although an email address is required to post a comment, your email address will never be published here. We'd love to hear from you.

Walkaway Homeowners: Fact or Fiction?

U.S. lenders claim people who owe more on their homes than they're worth are simply abandoning them, "walking away" from high mortgage payments.

Bankers say the trend is frightening because homeowners in the past have gone to great lengths to avoid foreclosure.

But the Los Angeles Times reports few banks or real estate trade groups have been able to produce hard figures about the phenomenon. Marianne Sullivan, senior vice president at Fannie Mae, said she hears more stories about walkaways but still called them "folklore."

Bruce Marks of Neighborhood Assistance Corp., a Boston group that helps homeowners, said that to the extent there are walkaways lenders should take the blame.

"Who do you see walking? They're people whose rate is about to reset and they see no way out," Marks said. "People who have a fixed-rate mortgage that was initially affordable and continues to be affordable don't walk away from their home, even when it's underwater."

Stuart Gabriel, a real estate expert at UCLA, said some of the apparent walkaways are likely to be people who bought houses as speculation and lied on mortgage applications, saying they would live in them.

What is your take on this? Do you know of anyone personally who has taken the "walk away" attitude with their home? Use the "comment" link below to tell us about it. Don't worry, your privacy is protected, no email addresses EVER get published from our reader comments.

Global Warming Hits Home

As the earth heats up and the ocean level rises, waterfront real estate along the oceans could be in trouble. But global warming could affect prices everywhere… and sooner than many people think.  Money Editor Stacy Johnson takes a closer look at how Global Warming is hitting home, literally…. this video runs 1:48…

Does the worry about rising ocean levels or global warming make you think twice about where you might buy your next home? Or is it a non-issue for you? We'd love to get your feedback on this. Just use the "comment" link below to sound off about Global Warming as it may (or may not) affect real estate in the future.

Home Loans Without the Big Down Payment

Many people give up on the dream of home ownership before they even get started because they just don’t believe they will ever be able to afford the down payment and closing costs.

A down payment can be as much as 20 percent or more of the purchase price of the house and if you are looking at homes that cost as little as $150,000 you will need to come up with as much as $30,000 just to be approved for the mortgage. Most people don’t have this sort of money sitting in their bank account.

For those thinking these fees would hold them back from home ownership, there is an alternative. There are home loans out there that will help you to get into a home for very little in the way of a down payment and very little in the way of closing costs. Not everyone will qualify for these loan programs, but many people will and many people have been able to buy a home because of them. Why not find out if you qualify?

One of the best home loans for people without a large down payment is an FHA loan. FHA loans are loans provided by a lender but insured by the Federal Housing Administration. These loans allow a lender to provide funding to those who may have less than perfect credit because they are insured against default. These loans are a great option when you don’t have a lot of cash on hand because the down payment can be as little as three percent. When you are buying that same $150,000 home you would be looking at a down payment of $4,500 instead of $30,000. That's a much better deal, and while it still make take some time and effort to come up with the funds, it is much more doable for most people.

In addition to having lower down payment requirements, these loans also have limits as to what can be charged when it comes to closing costs. Many people are not prepared for the cost of closing a loan and they are handed a bill for thousands of dollars and their jaw sort of drops open. It’s hard to come up with these funds and a down payment. When you look at FHA home loans you will find they make closing costs much more affordable. There are also programs out there for you to take advantage of that will help you pay for the closing costs as well as the down payment.

Do your homework when it comes to financing the home of your dreams. You may just find that you can get into that new home for a lot less than you thought.

What is Happening to Mortgage Brokers?

What a difference a burst bubble can make. Only two years ago, mortgage brokers originated more than two-thirds of new loans, according to Wholesale Access, a mortgage research firm. Now their share of the mortgage pie has dropped to 45%.

That's a shocking loss of market share when you consider that brokers were supposedly a boon to borrowers. Because they don't work for any one bank, they can (supposedly) shop dozens of lenders on your behalf to get the best loan at the lowest price.

But they seldom did. Instead, many of these mortgage brokers pocketed kickbacks from banks in return for selling borrowers unnecessarily costly loans.

An April study by the Center for Responsible Lending, a nonprofit organization working to eliminate abusive lending practices, found that among borrowers with credit scores of 640 or less, those who used brokers paid an average of $5,222 more in the first four years of their mortgage than those who borrowed directly from a bank. Borrowers with credit scores of 640 to 720 paid $1,316 more.

If shopping for a mortgage, and you want to use a mortgage broker instead of going directly to a bank, demand that your lending middleman set his fee in advance - not just what you will pay but also what he will get from the bank, which affects your rate. His or her total fees should not exceed 2% of the loan.

Have you used a mortgage broker before? Do you feel you were treated fairly? We'd love to hear your experiences, or if you have never used a mortgage broker before but know of someone who has, leave us your comment or thought on this matter below by clicking on the "commment link". We'd love to hear from you on this subject.