Nothing like seeing a C list celebrity shilling for something...

Happy Friday!

Even with heavily touted "relief" programs like Project Lifeline, home foreclosures are still rising at a rapid pace. Bloomberg reports that filings for foreclosures in April went up 65 percent over this time last year.

So, while economists debate about whether we are in a recession, and whether the housing market problems will put us there if we aren't already, the fact remains that there are real people out there losing their homes.

And that may have a real impact on the economy.

The National Association of Realtors claims that home prices have fallen the most since 1979. BloggingStocks reports on the extent of the drop in home prices:

The median price fell 7.7% to $196,300 in Q1 2008 down from $212,600 for the same period a year ago, the NAR said. It was the largest year-over-year decline since the NAR started keeping comprehensive records of median home prices in 1979.

While this may not bode particularly well for the economy, it might be a good thing for you. If you can qualify for a home mortgage loan (you will need better credit and a bigger down payment), you can get a good deal when buying a home in many real estate markets.

Should some subprime mortgage loans have even been made?

The common sense answer that many of us would have come up with is "no."

But in order to document cases of whether or not some borrowers should have been qualified for their mortgage loans, MBIA is having forensic experts look at their mortgage loans.

That's right. Highly trained professionals are on the case.

With real estate markets slowing down in general, many are looking for signs of life. And in some of the hardest-hit areas, it does appear that sparks of life are appearing. However, it seems mostly due to interest in foreclosures. And, while there may be signs of life in some real estate markets, Calculated Risk warns that the current housing downturn is by no means over:

This doesn't mean prices have bottomed - especially in real terms - but the increase in transaction volume might indicate that most of the nominal price decline has already occurred for some low end areas.

Nobody really knows how much hedge funds are worth, and that is part of the current problem. I enjoyed this video, H-E-D-G-E, and hope that you do, too.

Happy Friday!

Right now, it can seem tempting to take out a home equity loan to pay off credit card debt. With talk of a recession continuing, it might seem like a good idea to get rid of your debt with a debt consolidation loan funded by a home equity loan. But, really, this may not be the best idea.

First of all, when you have credit cards, they are unsecured. This means that credit card companies can't take any of your assets. Once you use a home equity loan for debt consolidation, though, things change. Now that debt is secured with your home.

During the best of times, when the real estate market is on the rise, it can be a good idea in some cases to use a home equity loan for debt consolidation. Right now, though, you are better off reducing your debt through other means.

Last fall, my husband and I bought a house for our little family. We are generally very happy with it. But since it is new construction, it missing things. Like a front yard and a back yard. So we've been getting bids on sprinkler systems and landscaping.

We will actually probably do a great deal of the landscaping ourselves, since it is so expensive. Indeed, one estimate put the whole thing at $20,000. Which is why, the landscaper explained to me, that few people get landscaping done at once unless they have it added to their home mortgage loan to begin with.

Just as we added $12,000 to the price of the home by having the developer finish the basement (good choice on our part), we could have had the landscaping done by adding more to the mortgage. But, since we can do the landscaping ourselves, and we couldn't finish the basement as nicely as it was done, the cases are different.

But I'm pretty sure we're not going to be getting a home equity loan to pay for the landscaping...

Yesterday, former Fed chair Alan Greenspan commented that we are actually in a recession. Today, current Fed chair Ben Bernanke is commenting on mortgage market problems. He is sharing his thoughts on foreclosures, and the fact that subprime mortgages are providing the largest number of them. Calculated Risk reports on Bernanke's comments on the mortgage market problems:

The sharpest increases have been among subprime mortgages, particularly those with adjustable interest rates: About one quarter of subprime adjustable-rate mortgages are currently 90 days or more delinquent or in foreclosure.

Not surprisingly, Bernanke expects the rate of foreclosures to continue to climb through 2008.

At this point, with food and oil prices rising, and the US dollar sinking, it is no surprise that many people are primarily concerned with how the economy will affect their personal finances.

Alan Greenspan has been changing his rhetoric over the last few months. He has gone from pooh-poohing the idea of a recession to talking of a possibility of a recession to affirming an economic slowdown. Now, though, he has decided that we are in a 'pale recession.' Greenspan thinks that this very shallow recession could last throughout the remainder of the year.

Do you think we're in a recession?