If Money Is Cheap, Why Can't I Get A Loan?

(CBS)  At a series of auctions in California this week, nearly 1,200 foreclosed homes are going at fire sale prices, reports CBS News Business Correspondent Anthony Mason.

Home prices are still in freefall. And mortgage rates are near record lows. But even after the banks have been given more than half-a-trillion dollars in bailout funds, the Fed said Wednesday that credit conditions "remain extremely tight."

How low do mortgage rates have to go before the market has real stimulus?

"I'm looking for the buy-one, get-one-free deal," says Rick Sharga of RealtyTrac, a company that monitors the real estate industry.

Sharga says buyers are still afraid.

"And I think the banks have the same issue with lending," he says, "They're making it difficult for people to get loans unless they're Donald Trump."

"Everybody tells me how low interest rates are," says billionaire Donald Trump. "And then I say where do you get the money? And then they say there is no money available."

Trump, who has properties in 10 states, says even billionaires are having a hard time.

"Literally, if you have a building making $10 million a year, and you have a $2 million mortgage on that building, and it comes up for refinancing, you can't refinance it," Trump says. "The banks are not in business."

Atlanta's Fidelity Bank had cut back on loans.

"We were having to hold tight on lending because we did not want to run out of capital," says Jim Miller, chairman of Fidelity Southern.

But after getting $48 million in TARP money, Miller says they're lending again, just more carefully.

"You look twice to lend where you would only look once before," Miller says. "But we're obliged to lend. We're a bank."

But some banks are hoarding cash to protect themselves from mounting losses, Mason reports. That's what's behind renewed talk of the government buying up the banks' bad debts, so they can begin lending again.

By Anthony Mason

"Freeze mortgage lending rates as low as 3.5% and enforce the banks to lend at that rate, example Japan years ago."

What? Yeah.. While we''re at it, let''s get the government to give all of us a citizen uniform. I know, let''s get the government to take supply and demand out of all of our products and set all of our prices for us! That should do the trick! You have to be kidding me... When are we going to realize that the government is the problem... The more government control you have, the less freedom we the people have under our democracy. Whether we like it or not, banks and lending institutions are for profit institutions... They are not going to lose money in an attempt to better the country...

[mom_o_truth]

Freeze mortgage lending rates as low as 3.5% and enforce the banks to lend at that rate, example Japan years ago.

spadeisspade:
I disagree with the whole take on this. I am a person that WANTS to purchase a home. I have the down payment, the credit score, and even the HOME I wish to purchase apprasied and ready to buy! My issue with all of this is WHY is it that the banks have a bail out pile of MY tax dollars in their pocket, and they STILL want the interest rate that is NOT what I consider to be fair and low enough. They are paying zero to .25% for the money that they then wish to get anywhere from 5 to 7% from a qualified buyer like me. In the 90s, rates were at 3.25% on money that cost the banks a way lot more then its cost them now. Just how much do they need to call "making a fair profit"?????
no where do I see a rate on morgages that are fair. Instead, they give us the line that the rates are sooooo low!...I disagree. They are still being greedy and thats what got us here to begin with!


Man o Man!.. haha... You are WAY off base.. You are speaking of the federal funds rate AKA the Prime rate of interest, which is set by the government for bank to bank lending..That only has to do with SHORT TERM LENDING,(loans at less than 1 year).. Mortgage Lending is based on free market supply and demand economics from the buying and selling of mortgage backed securities. It''s people like you that "think they know" the industry that gives all of us fits!

What''s sad is I bet several others read your comment thinking, "yeah! They''re ripping us off!" haha..

[wardoglrs]

If Money Is Cheap, Why Can''t I Get A Loan?.
More proof on why Americans are stupid.

"Control oil and you control nations; control food and you control the people."
Henry Kissinger ex U.S. Secretary of State and ongoing agent for the ruling class. Living.1970

%u201CWe are opposed...by a ruthless conspiracy that relies primarily on covert means for expanding its sphere of influence--on infiltration instead of invasion, on subversion instead of elections, on intimidation instead of free choice, on guerrillas by night instead of armies by day. It is a system which has conscripted vast human and material resources into the building of a tightly knit, highly efficient machine that combines military, diplomatic, intelligence, economic, scientific and political operations.

Its preparations are concealed, not published. Its mistakes are buried, not headlined. Its dissenters are silenced, not praised. No expenditure is questioned, no rumor is printed, no secret is revealed. It conducts the [war] with a war-time discipline no democracy would ever hope or wish to match...%u201D John F Kennedy, 1961.

If it be the pleasure of Heaven that my country shall require the poor offering of my life, I will be ready, at the appointed hour of sacrifice, come when that hour may. But while I do live, let me have a country, and that a free country!
John Adams

%u201COne of the penalties for refusing to participate in politics is that you end up being governed by your inferiors.%u201D Plato

[tincup356]

If you people get a chance read the story about the CEO of japan airlines on the business page....This man deserves recognition,,,,a true example of humility,,,,,,my hat is off to him ...every CEO in America SHOULD be like this guy.

[tincup356]

Congress and the banks are committing treason,,,,and people just stand by and watch....when the numbers get big enough,,,that will change,,,,,,when ,,,it couldn''t happen to me becomes what happened?,,,,,Congress either does not realize how close to a revolution they could bring things....OR DO THEY?

[wardoglrs]

%u201CCompetition [i.e. capitalism] is a sin.%u201D
%u201CI want to own nothing and control everything.%u201D
%u201CThe ability to deal with people is as purchasable a commodity as sugar or coffee and I will pay more for that ability than for any other under the sun.%u201D
John D. Rockefeller (Fascist cartel robber baron and promoter of the U.S. %u201CFederal Reserve%u201D Act in alliance with the Rothschild bloc. 1839-1937)

%u201CI don%u2019t care who the government is. Let me control the money and I will control the country.
Mayer Amschel Rothschild attributed to the German godfather of the Rothschild bank cartel and grandfather to heir Lord Baron Nathaniel Mayer de Rothschild owner of the Bank of England and a key promoter of the U.S. Federal Reserve Act. 1744-1812

The strongest reason for the people to retain the right to keep and bear arms is, as a last resort, to protect themselves against tyranny in Government. Thomas Jefferson

If tyranny and oppression come to this land it will be in the guise of fighting a foreign enemy. Thomas Jefferson

Control oil and you control nations; control food and you control the people.
Henry Kissinger ex U.S. Secretary of State and ongoing agent for the ruling class. Living. Quote 1970

The danger is not that a particular class is unfit to govern. Every class is unfit to govern
Lord Acton.

Unfortunately, nothing will preserve liberty but downright force. Whenever you give up that force, you are inevitably ruined. Patrick Henry

[grandesign]

"I can''''t figure out why you are reporting on the credit issue the way you did in this story. Everyone can agree that the root of the housing crisis lies in the number of residential foreclosures. If you agree with this premise . . ."
Posted by spedog11 at 08:36 PM : Jan 28, 2009

I don''t agree with this premise. The housing crisis lies in the overspeculation of housing, with pricing properties way beyond their worth (and what the market would bear). To support this fraud, you had lending companies, property appraisers, and investment banks all claiming low risk and high returns on false real estate values.

[tibu987]

o more "bailouts".

Let ineptly managed companies fail and go out of business. Others, with better ideas will step in and the U.S. will become stronger than ever.

I predict that even with "bailouts", the automobile companies will eventually go out of business anyway.
I predict that the banks and insurance companies even with the "bailouts" will continue to be poorly managed and continue with usurious practices and paying large salaries and bonuses to inept management.

None of the "bailouts" will bailout the American taxpayer.

[grandesign]

The top 1% could care less about you and me, just so long as they get to keep their 10 houses, fleet of 15 limos, corporate jets, and $50,000 shower curtains!
Posted by walt1944 at 10:09 AM : Jan 29, 2009

I resemble that remark!