❗Let's close the gap: We still need your help to raise $40,000 by April 1. Donate now

Fed cut may not help foreclosures

Jeff Tyler Jan 31, 2008
HTML EMBED:
COPY

Fed cut may not help foreclosures

Jeff Tyler Jan 31, 2008
HTML EMBED:
COPY

TEXT OF STORY

Scott Jagow: The Fed has now cut its interest rate a point and a quarter within about a week. That should get the economy’s juices flowing. But will it help people on the verge of losing their homes? Doubtful. More now from Jeff Tyler.


Jeff Tyler: Right now, around the country, more than 800,000 properties are in some stage of foreclosure. The Fed’s move won’t save them.

Rick Sharga: The rate cut will probably help market psychology more than it will help anything else. It will probably have a very marginal effect on real foreclosure activity.

That’s Rick Sharga with Realty Trac, which follows national foreclosure activity — 2007 set records. And Sharga expects that foreclosures will remain steady for the first part of this year.

Sharga: We’re probably going to be looking at between a half a million and three-quarters of a million properties being repossessed by the banks over the course of 2008.

If you’re in jeopardy of losing your home, reach out to your lender. Sharga says most banks don’t want to take your property — they don’t want to be in the real estate business. So they’ll often negotiate a refinance package, figuring that less is better than none.

In Los Angeles, I’m Jeff Tyler for Marketplace.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.