To put the shadows into perspective, S&P says this latest number, which is based on the original balances of the loans, represents slightly less than one-third of the outstanding non-agency residential mortgage-backed securities (RMBS) market in the United States.

The New York City metropolitan statistical area (MSA) has the highest months-to-clear in the nation, at 202 months.

The good news is the rate in which shadow inventory is occurring has slowed.

The best thing to do is to buckle up and knock out that debt as quickly as possible.  Also remember to cancel open credit cards that have a large balance available for you to spend because lenders see that as potential debt. So how do you get rid of debt methodically?   Janet Hutchins of Credit Cards Canada has some great tips, including the debt snowball,

… list all of your debts, starting with the lowest balance and up through the highest balance. List out the minimum payments as well. Next, decide how much extra you have each month to put toward your debt. Once you know this, you continue to pay the minimum balance on all of your debts. But, for the debt with the lowest balance, you put the extra toward it — on top of the minimum balance.

Read about the debt avalanche and debt snowflaking, too.  All great tips for people wanting to lead a debt-free, financially healthy life.

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However through the Mortgage Debt Relief Act of 2007, this tax debt was forgiven for millions of people.  Unfortunately this is due to expire at the end of 2012 so could be big trouble for people already in financial trouble. According to DS News.com, it may be extended.

“Obama did include it in his budget, to extend it to 2014,” said Mark Luscombe, a principal analyst for tax research firm CCH, in a statement. “Congress….. might decide it’s not as crucial as extending the tax breaks that already expired at the end of last year.”

That doesn’t mean Congress won’t eventually act to extend the relief, Luscombe said.

If Congress acts, the tax relief could be extended to January 1, 2015.

Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan dropped to 3.88 percent this week, down from 3.9 percent. In February, the rate hit 3.87 percent, the lowest since long-term mortgages began in the 1950s.

The 30-year loan is the most common financing option for home buyers.

I know more and more people who are finally in the market to buy and are sure fortunate that they are getting these kinds of interest rates!

The National Association of Realtors says,

Pending home sales increased in March and are well above a year ago, another signal the housing market is recovering. 

“The housing market has clearly turned the corner.  Rising sales are bringing down inventory and creating much more balanced conditions around the county, which means home prices will be rising in more areas as the year progresses,” said Lawrence Yun, NAR’s chief economist.

While other are predicting the second foreclosure wave, we will cling to the notion of a recovery until proven differently!

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Banks and the federal government have tightened lending requirements. Each blames the other for the difficulties consumers have getting financing. It’s all a reaction to the big mortgage circus a few years back, when government regulators were lax, banks were handing out easy money and borrowers racked up debts they couldn’t pay.

The riskiest loans, made from 2004 to 2007, still haunt banks: The federal government now owns many of them and is forcing banks to buy some back.

Evidently when the government buys so many loans, their restrictions are greater so in order to sell lenders must meet those requirements.

Photo from Remash.