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I will be on the radio with fellow Real Estate Agent Steve Kittrell on Saturday, December 22^nd, 2007, from 9-10 AM, on station KGEO-AM 1230. If you want to comment on my blog, Bakersfield Real Estate, or anything Real Estate related, give us a call at (661) 847-1230. You can listen over the internet, in case your radio is broken, and there is a link on Steve’s website: www.SteveKittrell.com

Since Steve is a former golf pro, we will also be looking into the rumor that Tiger Woods was in town playing golf at Seven Oaks. Steve Kittrell's show is called Talkin’ Real Estate.

Merle Haggard returns to the Fox Theater February 13^th! I saw his last appearance there, and according to the review in the Californian, it was marred by rowdy fans. But though it was a tad bit annoying, it was a hometown crowd that got a little carried away expressing their admiration, and they did settle down long enough for Merle to put on an excellent show in spite of the rowdiness.

Reading the LA Times, I saw a good Real Estate related cartoon by Rob Rogers: Sweet Equity.

There was also a bill that passed in the House that would for three years erase the tax bill that many homeowners would face as they struggle with burdensome home loan payments. Read all about it here.

Under the legislation, if debt was forgiven in a foreclosure, short sale, or as part of a loan workout it will not be classified as income. What that means is if you owed $300,000 but then had a short sale and sold your house for $200,000, you wouldn’t owe taxes on the $100,000 the bank forgave you for. The IRS was considering that as income, and on top of selling your house and getting nothing at all, you were stuck with this tax bill. File it under Insult to Injury. Now, if only you could get the bank to agree to a short sale, that might help some people. Anyway, it is a start.

The Federal Reserve was also proposing new restrictions on lenders. Read all about it here.

Meanwhile, Gov. Arnold Schwarzenegger and U.S. Treasury Secretary Henry M. Paulson Jr. were in Stockton with a message of hope to the folks at a townhall meeting of about 250 homeowners. Stockton could be the epicenter of California's sub-prime mortgage crisis, as it has one of the highest foreclosure rates in the country. See my previous blog, or check out the Repo Home Tour website, about the bus tours of REO homes in Stockton. www.repohometour.com

"This crisis is not going to last," said Arnold. "It's a bump in the road." He predicted that California's declining home values would turn upward again soon. Meanwhile, he and Paulson touted new state and federal initiatives that would freeze the mortgage monthly payments for homeowners who would otherwise face a big increase. A lot of the sub-prime loans contained ARMs, or Adjustable Rate Mortgages. Buyers were not aware or didn’t understand that the rates could shoot up, and make their monthly payments impossible to maintain. And if they made their payments on time, and could qualify for a better rate if they refinanced, then they were stuck with a pre-payment penalty.

"Our economy is healthy, U.S. Treasury Secretary Paulson noted, but added, "The biggest risk to the economy right now is the housing slump." Without action, as many as 1.8 million homeowners with adjustable-rate mortgages could face foreclosure in the next two years, he warned.

"The problem is going to get much worse unless we can do something about it," said U.S. Treasury Secretary Henry M. Paulson, Jr. You can read that LA Times article here.

Even Boston Legal had to weigh in on the issue, with Alan Shore (James Spader) representing Clarance Bell in a foreclosure. He got the bank to give Clarance a fixed rate mortgage of 8% and 60 days to begin making payments. I guess he had an ARM (Adjustable Rate Mortgage). Alan Shore was arguing that a jury would sympathize with someone in this situation, and it is funny, but a similar case actually happened in Cleveland with Judge Christopher Boyko, who threw out 14 foreclosures that were packaged in a security bond with Deutsche Bank. While Alan Shore was only able to get an out of court settlement of a fixed 8% mortgage, Judge Christopher Boyko dismissed without prejudice the above captioned foreclosure motions! Truth is stranger than fiction! Read for yourself, here is the complete decision: PDF File of Judge Boyko’s decision