Like all roofs flat roofs require regular maintenance. Localised damage on the smooth surface of an asphalt or bitumen felt covering, e.g. splits and blisters can be patch-repaired with a repair kit. Repairing a flat roof is not difficult even for complete novices.
To deal with splits, first remove any chippings. Use a blow torch or hot air paint stripper to soften the roof covering so that you can scrape the chippings away. Then, before embarking on the actual repair work, clean the area and kill any moss and lichen with a fungicide or bleach. Take care when cleaning because the effectiveness of any repair work will depend on the adhesiveness of the surface when you apply any patches.
Use self-adhesive tape to repair the split. Most of them are suitable for use on all types of roof coverings. Fill a wide split with a mastic compound before taping. Apply the primer supplied over the area to be covered and leave for one hour. Peel off the protective backing of the tape and apply it to the primed surface. Where a short split has occurred along a joint, cover the whole line of the joint with tape. Press the tape down firmly and make sure that the edges are sealed.
Blisters in asphalt or felt roofs only need to be treated if they contain water or have caused the roof covering to leak. Press the blister to check if moisture is expelled. If so, it must be sealed with a patch.
To repair a blister in an asphalt roof, heat the area with a blow torch or hot air paint stripper. When it is soft, try to flatten the blister. If the blister is filled with moisture, cut the blister open and let the moisture dry out. Gently heat the asphalt again before pressing it back into place. Apply mastic into the opening before closing it. Finally cover the area with a patch of repair tape.
To treat a blister on a felt roof make two intersecting cuts across the blister and peel back the felt. You can heat the felt gently to make this easier. Clean the opening and let it dry. Then apply bitumen adhesive and when it has set a little, nail the covering back into place with galvanised clout nails. Finally, cover the repair with a patch of roofing felt glued on with bitumen adhesive or use repair tape. Cut the patch generously so that it laps all round.
A patched roof can be spruced up by applying a finishing coat of bitumen and chippings to create a more uniform surface area. If the surface covering has decayed you may have to re-cover the roof. However, a roof showing signs of general wear and tear can be brought back to life with a liquid waterproofing treatment. This consists of the cold application of a bitumen-based water proofer which is reinforced with a glass-fibre membrane. This should be done during warm and dry weather.
First clean the roof and kill any moss and lichen. Apply the first coat of water proofer with a broom and then lay the membrane into the wet material and stipple it with a soaked brush. Make sure the edges overlap by 5 cm or more and bed them down with water proofer. Apply three coats altogether. Let each coat dry before applying the next. Clean the brush with soapy water before each coating. When the last coat starts to set, cover it with fine chippings to provide a protective layer.
Repairing a flat roof is not difficult and within the capability of most people. By following the steps outlined above you can successfully repair a flat roof in very little time.
Monday, July 9, 2012
Sunday, July 8, 2012
Things You Should Know About How To Find A Home Equity Loan Lowest Rate Mortgage
You will discover an immense amount of people that have found themselves keenly trying to seek out a method to get extra cash through any way available. Those that own their homes, can actually try to apply for a home equity loan in order to obtain a decent amount of money. However, many people have questions regarding how to get a home equity loan lowest rate.
You'll find two main items that will likely be analyzed at the time you are trying to get hold of a 2nd mortgage. The first thing is your credit score, and the next is the sum total of value that you own on your home. Folks that have an adequate credit rating may in reality be able to get the lowest interest rates, whereas those with not so ideal scores may well find the undertaking difficult to conclude.
Just to give you an idea of where your score is presently at, it's prudent to endeavor to get hold of your credit file on your own before you apply for a home equity loan. Normally, anybody with a great credit rating can expect to obtain several of the lowest interest rates on their finance, while people with a low score normally have to pay a higher amount.
You'll find various different lenders that have changed their thoughts towards offering individuals that do not have good credit scores home equity loans. Even though, these lenders are there in the marketplace, acquiring a high credit rating is always going to be a factor which will set you above all the others.
So many people have noted that a terrific technique to become accepted for a 2nd mortgage is to apply for the loan through the identical mortgage broker that they are currently paying. If you go this road, your broker already has all of your data, and this is likely to save you an immense amount of time than trying to find a lender that will not have an inclination in relation to your present-day position.
A second mortgage works off of the value that remains on your house. This sum total is decided by comparing the market value of your property and the amount that you still have left to pay on the property. If you take out a loan against this amount, you are simply taking out finance for the difference between the face value of your property, and the repayments that you have left owing.
When it comes to finding the lowest rate you can for your 2nd mortgage it will pay you to shop around so that you can familiarize yourself with your options. You will save time applying for finance through your present mortgage broker, but it cannot be cast iron that they will manage to provide you the lowest interest rate available.
There are a lot of companies which might be keen to do business with people despite the consequences of their credit rating and the amount of value they have available on their real estate. Attempt to get hold of as many quotes as you possibly can in terms of finding a 2nd mortgage, and don't be afraid to ask questions as regards the loan.
Bear in mind that the people that shop around for the lowest interest rate on an equity loan, will probably be the ones that finish up finding the type of advance and the rates that they want.
You'll find two main items that will likely be analyzed at the time you are trying to get hold of a 2nd mortgage. The first thing is your credit score, and the next is the sum total of value that you own on your home. Folks that have an adequate credit rating may in reality be able to get the lowest interest rates, whereas those with not so ideal scores may well find the undertaking difficult to conclude.
Just to give you an idea of where your score is presently at, it's prudent to endeavor to get hold of your credit file on your own before you apply for a home equity loan. Normally, anybody with a great credit rating can expect to obtain several of the lowest interest rates on their finance, while people with a low score normally have to pay a higher amount.
You'll find various different lenders that have changed their thoughts towards offering individuals that do not have good credit scores home equity loans. Even though, these lenders are there in the marketplace, acquiring a high credit rating is always going to be a factor which will set you above all the others.
So many people have noted that a terrific technique to become accepted for a 2nd mortgage is to apply for the loan through the identical mortgage broker that they are currently paying. If you go this road, your broker already has all of your data, and this is likely to save you an immense amount of time than trying to find a lender that will not have an inclination in relation to your present-day position.
A second mortgage works off of the value that remains on your house. This sum total is decided by comparing the market value of your property and the amount that you still have left to pay on the property. If you take out a loan against this amount, you are simply taking out finance for the difference between the face value of your property, and the repayments that you have left owing.
When it comes to finding the lowest rate you can for your 2nd mortgage it will pay you to shop around so that you can familiarize yourself with your options. You will save time applying for finance through your present mortgage broker, but it cannot be cast iron that they will manage to provide you the lowest interest rate available.
There are a lot of companies which might be keen to do business with people despite the consequences of their credit rating and the amount of value they have available on their real estate. Attempt to get hold of as many quotes as you possibly can in terms of finding a 2nd mortgage, and don't be afraid to ask questions as regards the loan.
Bear in mind that the people that shop around for the lowest interest rate on an equity loan, will probably be the ones that finish up finding the type of advance and the rates that they want.
The first step - Finding out about college loan consolidation
We might think that for a regular college student the main concern is to attend classes, study for exams and turn in the papers before the deadlines. However, this is not the case in North America. The students in the United States and Canada have to deal with quite complicated financial decisions throughout their years of higher education. The reason is that higher education in these countries is provided by private institutions, which offer quality education but at quite spicy costs. In these conditions, students and their families have to face tough financial decisions when they choose a college to attend. For most of them, the fees are too expensive so the first step is to try obtaining a full scholarship or partial financial aid. For the rest of the expenses, there is the widespread option of contracting a college loan.
Students can contract more than one college loan during their four years of college. If they also pursue graduate studies, it is likely that they will end up with a collection of college loans that they end up paying back for many years after graduation. It thus turns out that a college loan is not something you leave behind at graduation, along with all the other college stories, but it is a life-long commitment. The practice of contracting a college loan is so common that an entire business has developed around it covering financial and legal services for the loan contractors.
A college loan can be offered by either a governmental agency or by a private company that takes care of such financial services. If the student contracts all his student loans from the government, than he can use the option of college loan consolidation. College loan consolidation is extremely advantageous because it actually means replacing a whole set of different loans with various interest rates with just one loan having a unique rate. The main benefit of college loan consolidation is that it gives the chance to lock in the interest rate at its current value (the value at the time when the consolidation is made) thus offsetting changes in interest rates taking place over the next years, when the loan is being repaid. Nowadays, all recent graduates are advised to pursue college loan consolidation as soon as they can because rates for college loans are at an all time low and they will not remain so for too lone. Doing college loan consolidation now means that the student makes sure he or she will pay the same low rate for the following ten or more years, although interest rates for college loans may increase by 10% or more in this period.
College loan consolidation is most commonly done by recent graduates, who are starting to face the difficulties of starting to pay back the loans. Usually, during the college years, the government will subsidize the payment of the rates for students. During the first six months after graduation, young people can still be saved the trouble of having to think about college loan consolidation because they are given a grace period during which no payments should be made. The wisest of them start thinking about college loan consolidation in this time though. They consider alternative options and decide which scheme for college loan consolidation is most beneficial for them. College loan consolidation may be a tough decision to make, the financial packages offered include details that may be tedious to follow and understand. That is why recent graduates may end up postponing thinking about it. However, they are being pressured more and more to become responsible and do college loan consolidation now because of the low interest rates they should be taking advantage of.
Students can contract more than one college loan during their four years of college. If they also pursue graduate studies, it is likely that they will end up with a collection of college loans that they end up paying back for many years after graduation. It thus turns out that a college loan is not something you leave behind at graduation, along with all the other college stories, but it is a life-long commitment. The practice of contracting a college loan is so common that an entire business has developed around it covering financial and legal services for the loan contractors.
A college loan can be offered by either a governmental agency or by a private company that takes care of such financial services. If the student contracts all his student loans from the government, than he can use the option of college loan consolidation. College loan consolidation is extremely advantageous because it actually means replacing a whole set of different loans with various interest rates with just one loan having a unique rate. The main benefit of college loan consolidation is that it gives the chance to lock in the interest rate at its current value (the value at the time when the consolidation is made) thus offsetting changes in interest rates taking place over the next years, when the loan is being repaid. Nowadays, all recent graduates are advised to pursue college loan consolidation as soon as they can because rates for college loans are at an all time low and they will not remain so for too lone. Doing college loan consolidation now means that the student makes sure he or she will pay the same low rate for the following ten or more years, although interest rates for college loans may increase by 10% or more in this period.
College loan consolidation is most commonly done by recent graduates, who are starting to face the difficulties of starting to pay back the loans. Usually, during the college years, the government will subsidize the payment of the rates for students. During the first six months after graduation, young people can still be saved the trouble of having to think about college loan consolidation because they are given a grace period during which no payments should be made. The wisest of them start thinking about college loan consolidation in this time though. They consider alternative options and decide which scheme for college loan consolidation is most beneficial for them. College loan consolidation may be a tough decision to make, the financial packages offered include details that may be tedious to follow and understand. That is why recent graduates may end up postponing thinking about it. However, they are being pressured more and more to become responsible and do college loan consolidation now because of the low interest rates they should be taking advantage of.
Friday, July 6, 2012
Is 2013 A Good Year To Buy A New Home In Charleston, Sc?
Is 2013 a good year to buy a new home in Charleston, SC? Interest rates are their lowest in years. Banks seem to be back in the business of loaning money for home mortgages. It continues to be a buyers market in many areas of the country. But probably the most significant indicator that now is the best time to buy is for the sixth month in a row, existing home sales rose. Yes, rose, increased, went up, did not decline! The last time that happened was all the way back in 2005/2006.
As the housing market continues to recover, you and I are the potential beneficiaries. Home buyers are now beginning to realize that the opportunity to purchase a new home might never be better than it is today.
Have we actually turned the corner in the housing market? Even though economic conditions continue to weaken in many areas, the housing market appears to be strengthening. A number of economic strategist believe that the growing housing market just might be the shot in the arm that gets the overall struggling economy headed in the right direction.
With the expectation for inflation to decrease modestly over the next twelve months, and the recent surge in home sales, there may in fact be a light at the end of the tunnel in this economic nightmare. So if you have been wondering if now is the time to purchase that new home you have been dreaming about, maybe it is!
As the housing market continues to recover, you and I are the potential beneficiaries. Home buyers are now beginning to realize that the opportunity to purchase a new home might never be better than it is today.
Have we actually turned the corner in the housing market? Even though economic conditions continue to weaken in many areas, the housing market appears to be strengthening. A number of economic strategist believe that the growing housing market just might be the shot in the arm that gets the overall struggling economy headed in the right direction.
With the expectation for inflation to decrease modestly over the next twelve months, and the recent surge in home sales, there may in fact be a light at the end of the tunnel in this economic nightmare. So if you have been wondering if now is the time to purchase that new home you have been dreaming about, maybe it is!
Thursday, July 5, 2012
How To Choose The Right Shed Foundation
The Foundation - The First Step in Building a Shed
Laying a foundation is the first and most important step in building a storage shed. Whether you are planning to build a plastic shed, metal shed, or a wooden shed, it is essential to select a shed foundation that supports the weight of the structure and prevents warping, cracking, and other types of damage caused by moisture.
What Type of Shed Foundation is Right for You?
Your choice should be based on two factors - the construction of the shed you want to build and your budget.
First, you need to decide what type of shed you want to build and what you are going to use it for. If you want to build a shed that is meant for light storage such as garden tools it won't require a strong concrete foundation. On the other hand, if you're planning to build something that is meant for heavy storage, you cannot construct it on a timber foundation.
Dirt Floor
A dirt floor foundation is often used with a pole style barn shed. However, this type of foundation can not be used if the shed walls will be framed.
Crushed Gravel
A crushed gravel foundation is a good choice if the dirt floor is dry and water drainage is not a problem. This type of floor consists of a layer or pea gravel approximately six inches thick and works well for smaller sheds. It is also recommended to place cement blocks on the gravel to serve as footings for the shed.
Timber
A timber frame foundation, built of pressure treated wood, is also a good choice for a storage shed. The space within the timber frame can be filled with stone slabs, slate slabs, or gravel. Or, more simply, a timber floor can be attached to the frame. This type of shed foundation is very easy to install. The timber frame foundation also works well for medium size sheds that don't require a concrete foundation.
Plastic
A plastic base, made of a series of grids made of toughened plastic, is also becoming a popular choice among people these days. The flooring area contained within the grid pieces can be filled with pea gravel. This type of foundation is durable and very easy to install.
Concrete
A concrete floor is the strongest and most durable floor you can build. You can choose between concrete blocks, poured cement, slabs, or piers.
If the ground surface is uneven or sloped concrete piers may be you best bet. Moreover, a pier foundation is not a permanent structure. So, if you ever need to move your shed, the foundation can be removed and moved to another place easily. This type of floor is very easy to install and not as costly as a concrete slab.
A concrete slab based shed foundation is a good choice for a large shed that will be used as a workshop or to store vehicles. Laying a concrete slab base, however, is a task that requires some special skills. If you cannot do it yourself, you might have to hire professionals, which will add to your overall cost.
A concrete block based foundation is another choice you have. It is also strong and durable making it ideal for heavy equipment. When compared to a slab base, it is easier to install and less expensive as well.
Choosing the Right Foundation
Among the types of foundations that we have discussed the concrete floor is the most expensive whereas the gravel or dirt floor is the least expensive. Similarly, installing concrete slabs takes a lot of time and effort whereas plastic grids or timber frames can be installed quickly and easily. Under no circumstances should you build your shed foundation in an area where water accumulates as this will create problems later on.
Laying a foundation is the first and most important step in building a storage shed. Whether you are planning to build a plastic shed, metal shed, or a wooden shed, it is essential to select a shed foundation that supports the weight of the structure and prevents warping, cracking, and other types of damage caused by moisture.
What Type of Shed Foundation is Right for You?
Your choice should be based on two factors - the construction of the shed you want to build and your budget.
First, you need to decide what type of shed you want to build and what you are going to use it for. If you want to build a shed that is meant for light storage such as garden tools it won't require a strong concrete foundation. On the other hand, if you're planning to build something that is meant for heavy storage, you cannot construct it on a timber foundation.
Dirt Floor
A dirt floor foundation is often used with a pole style barn shed. However, this type of foundation can not be used if the shed walls will be framed.
Crushed Gravel
A crushed gravel foundation is a good choice if the dirt floor is dry and water drainage is not a problem. This type of floor consists of a layer or pea gravel approximately six inches thick and works well for smaller sheds. It is also recommended to place cement blocks on the gravel to serve as footings for the shed.
Timber
A timber frame foundation, built of pressure treated wood, is also a good choice for a storage shed. The space within the timber frame can be filled with stone slabs, slate slabs, or gravel. Or, more simply, a timber floor can be attached to the frame. This type of shed foundation is very easy to install. The timber frame foundation also works well for medium size sheds that don't require a concrete foundation.
Plastic
A plastic base, made of a series of grids made of toughened plastic, is also becoming a popular choice among people these days. The flooring area contained within the grid pieces can be filled with pea gravel. This type of foundation is durable and very easy to install.
Concrete
A concrete floor is the strongest and most durable floor you can build. You can choose between concrete blocks, poured cement, slabs, or piers.
If the ground surface is uneven or sloped concrete piers may be you best bet. Moreover, a pier foundation is not a permanent structure. So, if you ever need to move your shed, the foundation can be removed and moved to another place easily. This type of floor is very easy to install and not as costly as a concrete slab.
A concrete slab based shed foundation is a good choice for a large shed that will be used as a workshop or to store vehicles. Laying a concrete slab base, however, is a task that requires some special skills. If you cannot do it yourself, you might have to hire professionals, which will add to your overall cost.
A concrete block based foundation is another choice you have. It is also strong and durable making it ideal for heavy equipment. When compared to a slab base, it is easier to install and less expensive as well.
Choosing the Right Foundation
Among the types of foundations that we have discussed the concrete floor is the most expensive whereas the gravel or dirt floor is the least expensive. Similarly, installing concrete slabs takes a lot of time and effort whereas plastic grids or timber frames can be installed quickly and easily. Under no circumstances should you build your shed foundation in an area where water accumulates as this will create problems later on.
Tuesday, July 3, 2012
Seven Habits of Highly Successful People
The Differences Between You and Them
Have you ever wondered what highly successful people do that perhaps you don't? Or even what makes them different from you besides their success? If so, you're not alone. While there can be a multitude of differences between you and them, here are seven habits of highly successful people that might interest you.
1. Planning for the Future
Highly successful people typically spend the time they need to on the planning stage of any venture. Rather than relying on chance or luck, they plan ahead to foresee obstacles, then prepare to overcome them as they might occur.
2. Focus is Their Key
One insightful definition of focus is to "Follow One Course Until Successful". Many potentially successful people "give up" too soon. They hop from one scheme to another, hoping for instant success or to "hit a home run" on the first pitch.
3. Highly Successful People are Savers
What happens to your income as you receive it? Do you pay the bills, buy food, spend on other things and then finally, if there is any money left, put someth9ing away in savings? What should be paid first is you according to Robert T. Kiyosaki, author the the best-selling "Rich Dad, Poor Dad" series.
4. Goal Setting to Map Out Future Strategies
These people habitually set short and long term goals for what they wish to achieve. Using these goals as bench marks of progress and success, they can then map out strategies tom accomplish and achieve any goal that they have set for themselves, their businesses, their investments, their families and their lives. Do you set goals to attain what you are striving for?
5. Priorities are Set Early and Often
Everyday when they start off their daily schedule, highly successful people know what the priorities for the day are. They will keep high-priority tasks and events ahead of lower priority ones thereby allowing them to accomplish the most important tasks of the day first, each and every day. You too should set priorities for yourself.
6. Their Time is Scheduled
Microsoft mogul Bill Gates realized early in life that "if you want to both work hard and play hard, then you have to have a schedule". By scheduling what needs to be done each day, you can ensure that no important appointment, meeting, visit or other essential item gets inadvertently "left out" or forgotten during the course of a busy day. When chain-linked tasks which require one to be done prior to doing the next are scheduled, there is no concern that a critical or key step will be missed.
7. Take Time to Enjoy Life
No matter how busy they are or how hectic business affairs make their daily lives and schedules, highly successful people make the time to enjoy their lives and families. The concept of "taking a vacation later" or neglecting the needs and commitment to family are non-existent with virtually all people who ultimately achieve a high degree of success in their life.
Apply These Habits to Your Daily Life
If you will develop and apply these seven habits of highly successful people to your daily life, then you too could begin to enjoy greater financial freedom, prosperity and success. See you at the top soon?
Have you ever wondered what highly successful people do that perhaps you don't? Or even what makes them different from you besides their success? If so, you're not alone. While there can be a multitude of differences between you and them, here are seven habits of highly successful people that might interest you.
1. Planning for the Future
Highly successful people typically spend the time they need to on the planning stage of any venture. Rather than relying on chance or luck, they plan ahead to foresee obstacles, then prepare to overcome them as they might occur.
2. Focus is Their Key
One insightful definition of focus is to "Follow One Course Until Successful". Many potentially successful people "give up" too soon. They hop from one scheme to another, hoping for instant success or to "hit a home run" on the first pitch.
3. Highly Successful People are Savers
What happens to your income as you receive it? Do you pay the bills, buy food, spend on other things and then finally, if there is any money left, put someth9ing away in savings? What should be paid first is you according to Robert T. Kiyosaki, author the the best-selling "Rich Dad, Poor Dad" series.
4. Goal Setting to Map Out Future Strategies
These people habitually set short and long term goals for what they wish to achieve. Using these goals as bench marks of progress and success, they can then map out strategies tom accomplish and achieve any goal that they have set for themselves, their businesses, their investments, their families and their lives. Do you set goals to attain what you are striving for?
5. Priorities are Set Early and Often
Everyday when they start off their daily schedule, highly successful people know what the priorities for the day are. They will keep high-priority tasks and events ahead of lower priority ones thereby allowing them to accomplish the most important tasks of the day first, each and every day. You too should set priorities for yourself.
6. Their Time is Scheduled
Microsoft mogul Bill Gates realized early in life that "if you want to both work hard and play hard, then you have to have a schedule". By scheduling what needs to be done each day, you can ensure that no important appointment, meeting, visit or other essential item gets inadvertently "left out" or forgotten during the course of a busy day. When chain-linked tasks which require one to be done prior to doing the next are scheduled, there is no concern that a critical or key step will be missed.
7. Take Time to Enjoy Life
No matter how busy they are or how hectic business affairs make their daily lives and schedules, highly successful people make the time to enjoy their lives and families. The concept of "taking a vacation later" or neglecting the needs and commitment to family are non-existent with virtually all people who ultimately achieve a high degree of success in their life.
Apply These Habits to Your Daily Life
If you will develop and apply these seven habits of highly successful people to your daily life, then you too could begin to enjoy greater financial freedom, prosperity and success. See you at the top soon?
Sunday, July 1, 2012
The American Housing Bubble Timeline And Causes
The USA housing bubble wasn't something that popped out of a box one day. It was building up for the better part of the decade, but it still came as a shock. The subprime mortgage crisis and the real estate market crash were quickly followed by a severe credit crunch. With loans drying up, consumers stopped buying and the vicious cycle spiraled into the Great Recession of 2008-09. From 2007 to 2010, tens of millions of people lost either their homes or jobs or both.
The roots of this crisis go back to 2001, to the dot com crash and 9/11. This deadly combination knocked the stuffing out of the economy and the only thing people had left to maintain their lifestyles was home equity. Congress deregulated the banks and the Federal Reserve kept interest rates low, thus allowing mortgage lenders to shovel money out the front door to all comers.
The result was that speculators started buying homes just to make a quick buck. Even for ordinary home owners, it was easy to take out equity loans and second mortgages so that they could enjoy the fruits of the housing boom. According to BLS (Bureau of Labor Statistics) data, non-farm payroll employment for residential construction jumped 29.1% from 2001-06. Employment among loan brokers jumped nearly 120% during the same period, and the real estate credit industry grew by 52%.
Speculation fueled by irrational exuberance is what the FED is there for. They could easily have kept it under control by increasing interest rates. Instead, they did nothing until it was too late. Wall St. Was knee deep in derivative products created from these subprime mortgages. The lenders had created mortgage packages graded by the credit ratings agencies and then handed them off to investors.
Private equity funds began using it to setup massive leveraged deals where companies were wildly overvalued and the only security the banks had was these worthless mortgage papers. Everybody was in on the systemic fraud, and share values and home prices kept climbing. When the bubble finally collapsed in 2007, the banks were left mortgages in default and bankrupt companies which had been valued at billions just a year or two before.
By this time, home values had tanked so much that even ordinary people who had nothing to do with the mess found their home loans underwater. From 2006 to 2009, the real estate industry lost all the gains for the entire decade, and then some. Employment in residential construction dropped 36.6% and home loan credit companies started laying off employees so fast they lost 44% of the workforce in the same period.
Faced by a credit crunch and delinquent home owners, the banks panicked and sent out millions of foreclosure notices. Nearly 8 million homes were ultimately foreclosed in 2009-10. Over 10 million homes were still underwater in 2011, poised on the edge. The federal government has now forced the five biggest banks to spend billion to help out everyone who lost their homes due to The USA housing bubble.
The roots of this crisis go back to 2001, to the dot com crash and 9/11. This deadly combination knocked the stuffing out of the economy and the only thing people had left to maintain their lifestyles was home equity. Congress deregulated the banks and the Federal Reserve kept interest rates low, thus allowing mortgage lenders to shovel money out the front door to all comers.
The result was that speculators started buying homes just to make a quick buck. Even for ordinary home owners, it was easy to take out equity loans and second mortgages so that they could enjoy the fruits of the housing boom. According to BLS (Bureau of Labor Statistics) data, non-farm payroll employment for residential construction jumped 29.1% from 2001-06. Employment among loan brokers jumped nearly 120% during the same period, and the real estate credit industry grew by 52%.
Speculation fueled by irrational exuberance is what the FED is there for. They could easily have kept it under control by increasing interest rates. Instead, they did nothing until it was too late. Wall St. Was knee deep in derivative products created from these subprime mortgages. The lenders had created mortgage packages graded by the credit ratings agencies and then handed them off to investors.
Private equity funds began using it to setup massive leveraged deals where companies were wildly overvalued and the only security the banks had was these worthless mortgage papers. Everybody was in on the systemic fraud, and share values and home prices kept climbing. When the bubble finally collapsed in 2007, the banks were left mortgages in default and bankrupt companies which had been valued at billions just a year or two before.
By this time, home values had tanked so much that even ordinary people who had nothing to do with the mess found their home loans underwater. From 2006 to 2009, the real estate industry lost all the gains for the entire decade, and then some. Employment in residential construction dropped 36.6% and home loan credit companies started laying off employees so fast they lost 44% of the workforce in the same period.
Faced by a credit crunch and delinquent home owners, the banks panicked and sent out millions of foreclosure notices. Nearly 8 million homes were ultimately foreclosed in 2009-10. Over 10 million homes were still underwater in 2011, poised on the edge. The federal government has now forced the five biggest banks to spend billion to help out everyone who lost their homes due to The USA housing bubble.
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