Tim - Your second sentence says it all pretty clearly.  I have to say that I would rather see people being put in more houses than people being given a tax credit.  I think the government went with the theory that we all get that "burning a hole in your pocket" feeling when being given "free" money.  They were hoping to pump money into our pockets and we would in turn pump it into consumer goods - saving jobs, companies, etc.  Unfortunately, from what I see, many of the people who could and would use this money, can't get it.  They are under-qualifying for loans because of tighter standards.  Many of them aren't bad off, they just had too many bumps in the road.  When we start realizing that not everyone can be a shining example of credit worthiness, we can move on.  I understand the need for banks to watch their step, but now they're hugging the wall as they climb up the steps, have a tether line attached to the top of the stairwell, and have a mountain of pillows at the landing just in case they fall.  They're overprotecting, instead of doing what they should have done in the first place - make wise loan choices based on common sense.  Some will fail no matter how hard you try to cushion yourself, but when they were handing out loans attached to McDonald's french fries like Monopoly game pieces - well, I think you see the point I'm trying to make.

Lenn - The raising of the FHA down payment perplexed me.  What was their goal in raising it 0.5%?  I sure hope it wasn't to get people to have more "skin in the game" - around here you could up your down payment to today's standards with less than $750.  Not cheap, but not really all that expensive either.  If someone's going to let their home go into foreclosure (whether by choice or circumstance), $750 isn't going to stop them.  No-Doc loans...I have a good opinion of them, only because I was self-employed for the last 15 years and even when time's were good, my earnings came up minimal.  The difference between me and some people is that I took the time to analyze what the effects were.  I pay a much higher interest rate than anyone I know.  When people speak of the fear of rates hitting the high 5s and 6%, I can only chuckle quietly to myself.  Of course, when I saw the story in CA of the women who they gave a no-doc loan (100% financing to boot) for a $500,000 house and she was a cook at McDonald's - (once again) well, I think you see the point I'm trying to make.

Michael - It's sort of like the broker "warm body and a pulse" scenario.  When times are good, brokers and lenders will take on anyone.  When times are tough, they send people packing.  Maybe that's one of the core issues in our system?  Trepidation, hesitation, and misinformation are definitely hampering any efforts to clear inventory.  Now the rumor mill is whispering $15,000 (as it did once before).  If I were a consumer, why would I want to buy with an $8,000 tax credit, when I might be able to get almost twice that soon.  It doesn't matter if it's hard core fact or just playful musings.  People hear these whispers and react.  As a consumer, I would be thinking that I don't want to end up like those suckers who got in on the $7,500 tax credit who have to pay it back.  Imagine how those people feel watching their neighbor move in with an $8,000 check that he won't have to repay.  Not only is it a few dollars more, but it's "free."  If I were a $7,500 tax credit recipient, I'd probably march to Washington and tell them they can have my house and the $7,500...I'm going to get a new one.

Mark - I think that's one of the eternal problems in Washington.  I'm not trying to trash them, it's just a reality.  They live in a different world than you or I.  When they do understand, then they have to play "the game" to get something done.  I think part of what hampers any solution is that the issue isn't cut and dry and many don't agree on what has caused it.  There are multiple solutions across multiple industries and because of that, we wind up with a "uh, I dunno" kind of mentality.  We're overwhelmed by it and just wind up going in circles without any clear ideas on what to do.

Tim - Of course, if FHA and FNMA rules and guidelines are only viewed as guidelines and lenders and investors still call the shots, things won't change tremedously.  I remember having the discussion of the monetization of the First Time Home Buyer Tax Credit as a down payment both here and with one of my lenders and his thoughts were "good luck finding a lender that's going to do it."  Harsh words but true.  HUD can release any mortgagee letter it wants, but if the lenders and investors don't like it, it's soon forgotten.

Darin - Maybe we should offer to do it as a charity event for the first person who comes up with the solution?  Haha. Thanks.  Look forward to your comments, have a feeling this won't get the usual amount of comments as a normal feature, since it is rather lengthy, but I had a lot to say.

Lana - I have to disagree.  I never think it's too late to fix or change anything.  Sure, we may not be able to give homes that were lost back to people who went into foreclosure, but we can at least move forward and fix it for now and hopefully the future.  I don't think we'll ever be relieved of the ups and downs of real estate, but I do believe we can make them more bearable.

Deborah - I'm not sure if it's dumb or just blind to it all.  I understand they're a business.  Businesses exist to make profits.  I don't fault them for that.  What I fault them for is not adapting to changing situations and working harder to correct things for themselves and the industry that helps feed them.

Patricia - Let's keep the blood pressure down.  I try to use my frustrations as blog fodder.  The more passionate, excited, or angry I feel, the better my posts.

Margaret - I encourage more posts to follow.  Read my latest on AgentGenius and it will become clearer why I get excited by all of us feeding off of each other.

Bryant - That can make anyone fried!  Go sleep off the REOs and come back when you're fresh.

Carla - Don't shout out the window, shout on your blog!

Chris - After the last post upon post conversation I had (started by Carol Culkin and followed by several others, including myself), I really began to see the power of collaborative blogging.  None of it was planned, but as each blog took it's own view of what was important in the last blog, the conversation grew.  And you've read enough of my posts to know how I feel about conversation.

Brother Richard - I see your point, but my problem lies in the scapegoating of the $0 down people.  Many people that did were good responsible people, they weren't going outside their means, and they were working hard.  Aren't we all just a pay cut (or two or three) away?  That's part of the risk that lenders take.  What they want is "safe risk" - they want their cake and to eat it to.  It's like the stock market, you take risk when you step into it.  You expect a certain level of performance, but if it crashes, you have to just shake your head and say, "well, I took the risk and lost."  It's gambling in my eyes.  Even the military I view this way.  Most people didn't join the military years ago hoping there'd be a war so they could go off to fight and take risks with their lives.  No, they joined to get an education, earn some money, acquire some skills.  But when the wars came, they had to accept what they were given.  They took the risk in order to get the benefit out of the military.  Unfortunately in their case, the gamble could include being shot at.

Chris - Hopefully at some point I'll get to write my post I've been toying with for awhile about how I think the banks could solve a lot of their own (as well as the real industry's) problems.  It's glaringly simple and I've already hinted at it in this post.

Lane - I often wonder why builders continue to build in some areas.  We've slowed down in that category, but we're not stopped.  If you can't sell one that's already built, what makes you think you'll sell the ones you just poured foundations on?  I think the answer is simple - if builders stop, they're admitting defeat and they'll lose market share to others with deeper pockets.  That's my guess.

Kristin - That's what I can't figure out, we hear about how they were handing out $0 down loans to anyone that raised their hands, here is someone like you, that although you got the loan, had to wrestle your way to it.  Of course, I lived in CA as well and I saw how some of the lenders there behaved (my purchase here was almost done through a CA lender, but that's a completely different story).  You will help those folks and they'll remember you for it.

William - Call it transparency, honesty, or a willingness to show people that I understand because I've seen it too - whatever you call it, I think it's important to show your clients (and others) that you're like them.  I would assume that all Realtors® own 50 rental properties, have perfect credit, and can get a loan at the drop of a hat.  You and I know the reality.  It's not like that.  In fact, I'd bet that more agents have faced these problems than would care to admit (think about it, a job that can experience huge ups and downs?).  I have found that when speaking to people, especially about credit, they tend to be nervous about these sorts of things.  Knowing that I know what they mean can break the ice and get us more comfortable.  I do believe that there is a progressive movement in real estate.  There are attempts to make things work a little differently.  Some will love it, some will hate it, some will get bored of waiting and give up.  I believe that no matter which direction you think the various associations and the industry should be heading, being a part of it is the only way to go.

Jeff - I have a reputation for not being afraid of a long post.  One of the things I really enjoy about ActiveRain is being spurred to write something because of someone else.  I would never have written this post on my own.  But I love the post I wrote.  You mention the "wannabe investor" - let me tell you a little bit about why I timed my real estate entrance as I did.  I had always thought I would like to try it after I left the music industry.  I had an interest.  With all the flipping shows and all the "make millions buying homes for pennies on the dollar" ads on TV, I thought about how I didn't like the industry as it stood.  I saw just the bad side of "get rich quick" schemes and that's not what real estate is about (to me).  I think you can get rich from doing it and doing it well, but as with anything, there is no quick ride to the top.  As I started to see things start to slow down, I made my final decision to leave the band that year and begin my real estate license.  I didn't know how slow it would get, but I had hoped that entering it at the time I chose would allow me to focus on learning and learning everything I could as fast as I could.  I also knew that people would start dropping off.  I knew the pool of talent would get smaller and therefore I would have a better chance of survival.

On the education/loan issue, I agree.  There were plenty of slimeballs that used dirty dealing to make the money they wanted.  I'm sure there's still some of them and I'm sure there always will be some of them.  I think the problem (especially in the loan industry) is that most people don't know the ins and outs of a loan, so when you start using the terminology, you start confusing them and getting them to the point where they don't want to admit they're not quite getting it.  No one wants to stand up and say "Hey, wait a minute.  I feel really stupid because I don't understand a single word that's come out of your mouth in the last 30 minutes."  We don't like to embarrassed like that.  Of course, I think people need to learn to not be afraid.  When I do listing contracts and offers, I probably say "stop me at anytime and ask questions" about a million times.  Sometimes I can still see in their eyes that they don't quite understand.  I've tried to get better at seeing it, recognizing it, and fixing it with more education.  I love the fact that the consumer can get so much preparatory information first and then people like you can just bring it all home and help close the transaction smoothly.  If I could teach everyone one thing, it would be never keep quiet.  Ask. Ask. Ask.  If I don't want to explain it to you...I'm not an agent worthy of working with you.

And I appreciate that you enjoyed my dissection.  Sometimes it's hard to dissect and respond to something like that, but I'm talking mainly about your industry in this and although we are intertwined, I do try to let the loan guys do their jobs.  I know the basics, you know the rest.  Of course to do that, you need to trust the lenders (or agents in your case) to be able to competently handle their job.  So thanks for reading my post and commenting.

Integrity Mortgage Funding - The problem is that there are so many intertwined professions involved in real estate and then throw in a healthy dose of politics.  Now you've got an interesting recipie for disaster or success.  I do have faith that the system can work, although I do believe there will always be fringe elements - much like I know there a ton of awesome Realtors® out there that are doing the right things, but I'm not crazy enough to think there's no bad seeds.

Missy - I don't know if they know what's going on.  My assumption based on the way corporate structure works is that they have no idea.  Perhaps that's part of the solution?  Would they care?  I don't know that either.  Definitely something to think about.  As a Realtor®, this is one of my problems with the Code Of Ethics.  The Code Of Ethics is designed to prevent boneheads from making false accusations or starting rumors about other agents in order to gain their business.  Randy Hooker and I have had the conversation many times though - should it protect an agent from doing a half assed job for their client?  Of course, then we get into the definition of what "half assed" is.  Your half assed and my half assed probably differ, so suddenly the Code Of Ethics is needed again.  The shame is that it wouldn't be necessary to have it, if we would all just behave ourselves.  I guess it's the same as Anarchy vs. Government really.

Joe - I don't see it as tilting as windwills.  I'm under no belief that tomorrow Jeff, I, or anyone else is going to change the world.  What I do believe is that there are enough smart, bright, progressive individuals out there to slowly make the difference that could tilt the industry back to a positive side (both in perception of the public and actual market terms).

Dan - The first time I read anything by Jeff I saw something very simple.  A no BS attitude that I think is of major importance to the mortgage industry.  It's important on my side of the fence too, but I think the banking/lending/mortgage industry is always the quick and easy fall guy.  The faceless corporation that doesn't care about the little guy.  In some cases true, in some not so true.  That's what I see in Jeff.  Cut through it and help people.  Whether you're in the industry for money or to help people, helping people is the better way to go...because it leads to the money at the end of the day (win-win).

Kim - I encourage everyone to try writing a "reply" post to something they really liked.  It expands the conversation to new levels and opens new questions and allows for new people who may not have read the first article to join and hopefully offer a new look and some great solutions.

Paul - One of my first fears in the real estate industry was that everyone was going to be out to destroy the new guy and keep all the business for themselves.  I was wrong.  I have more agents in my cell phone for advice-only purposes.  Some far away, some right here in town.  I have taught agents things I discovered and they have given me tips from their experiences.  I was amazed at how there is a whole community of open-source style sharing in the real estate community.  I chose to align myself with that element for the simple reason that it's what I believe in.  So many helped me get to this point in my career and I can only hope to give some of that back to them and to the new agents entering the industry.