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Pamela Said:

Money, Banking and Financial Markets question related to the recent economic disaster?

We Answered:

Banks created money out of thin air (fractional reserve banking) and loaned this easy money to individuals (fooled by the low interest rates set by the Fed) causing a housing boom as people rushed to invest in housing.

Mortgage bankers also created securities and derivatives, to insure these mortgages against loss, and to allow investment bankers to gamble on their value (with cheap easy credit from the Fed). For example, here is a simple explanation of what went wrong with "collateralized debt obligations" - CDO

http://www.zerohedge.com/article/bank-cd…

Ratings agencies rated these securities as "AAA" i.e. very good investments, without even understanding them (or the risk of them), because the banks said they were good. Warren Buffet, one of the richest men in the world, called derivatives "financial weapons of mass destruction", but nobody cared because they were all making money.

4- If I was a consultant to Congress I would tell them to stop interfering with the economy. Also, abolish fractional reserve banking to prevent massive uncontrollable increases in the money supply, which fuel speculative bubbles and economic "booms". End the Federal Reserve and their price fixing (of money ie interest rates) activity, which destabilizes the economy. Allow the banks to go bankrupt. The constant bailouts will result in hyperinflation - these must be stopped NOW. However despite this more bailouts will happen, including the FDIC (bank insurance scheme), state governments such as California, state and federal pension schemes, and the federal government. All of these are bankrupt already and it is only a matter of time before they are bailed out.

If I was actually a consultant to Congress I would tell them 4) above, send this to a newspaper, and then set myself on fire. They would still not pay any attention.

The video below is one solution to the problem. It is very pro-government in theme (which actually sickens me to watch) but will give you some idea of the economic problems today. I prefer solutions based on the Austrian economic school (mises.org).

Olga Said:

what's the difference between "mortgage bankers" and "commercial mortgage bankers"?

We Answered:

commercial mortgage bankers usually deal with hard money loans; bridge loans, which are usually for commerical use. Sometimes they can be used for residential loans ie rental apartments. mortgage bankers deal more with residential loans such as single family, muti family, investment homes etc.

Leslie Said:

Question for mortgage bankers regarding down payment programs?

We Answered:

What you are referring to is the tax credit program for first time buyers who purchase a home before July 2009.
Here is a link that explains it.
http://www.irs.gov/newsroom/article/0,,i…

What some people are doing is using gift funds for the 3.5% FHA down payment and then paying the gift back once the receive the tax credit.

Dana Said:

Commercial Mortgage. $400,000.00 How much interest today? My banker is yanking my chain!?

We Answered:

If it's over 6% he's yanking your chain.

Clayton Said:

What is the role of commercial property mortgage bankers, and do they get paid by salary or commission?

We Answered:

On the website www.findacareerhere.com there is a salary calculator that tells you salary and also gives you a job description. Hope this helps.