Wednesday, April 8, 2020
Predictions
Posted By Babs De Lay on April 8, 2020, 4:00 AM
I don't make predictions very often but I'm going out on a logical ledge that a recession is coming our way. What I don't know is how long this one will last. The 2007 crash stuck around for around 18 months and was triggered by a variety of economic events, most of which was a huge pop of the nation's housing bubble that had raged out of control a few years earlier. The U.S. response was the passing in 2008 of the 'Emergency Economic Stabilization Act' which fed $700 billion in funds into the 'Troubled Assets Relief Program' (also known as TARP).
In 2009, President Obama signed the 'American Recovery and Reinvestment Act of 2009' which added another $787 billion into the economy. About $75 billion of that went specifically into programs to help homeowners keep their homes. That program worked for some, while others fell to scammers and ended up with eviction notices (like my dad).
This time around Congress has passed roughly a $2 trillion Coronavirus Aid Package, aka 'The CARES Act'. Senate Majority Leader, R-Ky., Mitch McConnell, told the Senate that it isn't a stimulus package but emergency relief.
Classified as emergency relief, many people will be getting a $1200 check pretty soon as part of this bill. This money is just the first phase of grand plans by our national leaders to boost a fallen economy. They haven't even sent the money yet and the speakers of the House and Senate are already talking about the next phase of money that will focus on modernizing America's infrastructure (upgrading national bridges and roads, main water lines and water treatment plants, more public health centers and internet). Job creation is intended to fix currently broken public facilities and structures.
You're sitting at home wondering if you or your friends can pay rent or mortgage, if you or they will have jobs when this is all over. If you're in good shape and want to take advantage of a recession's negative effect on property values, you might as well assemble the information your mortgage lender will need to get you a loan on that new home or income property.
You'll need two months current pay stubs, last two years' W2s, copies of checking and savings statements for last three months, copies of statements for IRAs, 401k, savings, CDs, money market funds, etc., employment history for last two years with addresses and contacts, proof of commissioned or bonus income, residency history for last two years with addresses and contacts. Also list your assets and what you'll use for a down payment, if self-employed your last two years tax returns, a current profit and loss statement and balance sheet, and a copy of partnership/corporate tax returns for last two years if owning more than 25% of company (if applicable). If you get all of that paperwork together, I predict you'll be poised to own property in your near future.
About The Author
Babs De Lay
A full-time broker/owner of Urban Utah Homes and Estates, Babs De Lay serves on the Salt Lake City Historic Landmark Commission. A writer and golfer, you'll find them working as a staff guardian at the Temple at Burning Man each year.
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