HELPING THE HARDEST HIT??

This past week, Jeniffer Granholm, our lame duck Governor of Michigan, announced that the Michigan State Housing Development Authority (MSHDA) with the help of banks, Credit Unions and non-profit counseling agencies, will launch a statewide program to help eligible Michigan homeowners avoid foreclosure by participating in the State's new Helping Hardest-hit Homeowners Fund.

The dollars for this, is part of the new $2.1 BILLION of federal money that the President has pulled out of the air to help homeowners in 10 states keep their homes. The fund aims to assist those in states that have seen average housing prices decline by 20% or more.

President Obama unveiled the Hardest Hit Fund in February to help folks struggling with home value decline, and a tight labor market and a near double-digit unemployment rate. The program is just one of several that the administration launched to combat the nation's housing crisis, but like their other initiatives, this has been met with criticism.

So finely last month, (only FIVE months after announcing the program) the treasury provided Michigan, along with California, Arizona, Nevada and Florida, a combined $1.5 Billion from the fund. The states expect to help thousands of homeowners by offering subsidies to the unemployed, reducing loan principal and offering incentives for short sales.

The State expects the $154.5 million program could "help" more than 17,000 households, including thousands who are currently drawing unemployment benefits. The program would also help owners who are behind on their mortgage payments because of a temporary layoff or medical condition, and those who have jobs, but have lost income. (GEES, THAT'S MOST OF THE POPULATION OF MICHIGAN)

The program began this past week and was met with frustration, as the State offices received 30,000 calls by 10:00 a.m. the first first day, causing it's phone system to crash. Officials say because it's not mandatory for lenders to participate, the state was still waiting to hear from large mortgage servicers. They said homeowners must apply for the program through their lenders, not the State.

Eligible homeowners can obtain more information by calling 866-946-7432 or visiting www.Michigan.Gov/Hardesthit .

Is this government handout going to save the housing industry in our state? NO!! Not if there aren't any JOBS for those 17,000 unemployed/underemployed homeowners to return to.

Is this going to stop the five year slide in home values?? Not as long as the banks, Fannie Mae and Freddie Mac are holding thousands of foreclosed homes in their "shadow inventory".

In Milford, Highland and throughout the Huron Valley area, along with most communities in Oakland County, Real Estate values have actually increased during the first quarter of 2010, but considering our government was paying people (through tax credits) to buy a home, we can assume that growth is going to disappear by the end of quarter three of this year.

Bottom line is, until the government stops manipulating the housing market and the interest rates, and allows business and industry to function freely, resulting in REAL job growth, there will be no true sustainable recovery of home values.

But hey, what do I know.....