The economy is in a recession and the banks are reporting grim financial's for the end of 2007, what have we learned?

The mortgage has been decimated by fallout out in both the credit market and rapid decline of the housing industry. This week we saw Countrywide sell off to Bank of America, Citigroup report almost a 20 billion dollar write down on their books related to mortgage backed securities and J.P. Morgan Chase post a 2 billion dollar write down as a result of the performance of sub prime and home equity loans within their portfolio. IndyMac Bancorp, one of the 10 largest mortgage servicing companies reduced their workforce by almost 25%. The federal reserve will be meeting later this month and most likely will lower the fed funds rate between .25-.5 % to try and help the economy. It is clear that the fed has not been aggressive enough in trying to head of the economic slowdown and many economists believe the economy will struggle into 2009 to try and recover. Mortgage rates are dropping and this is the only silver lining in the current economic state © LowRateMortgage.com 1-16-2008

 

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