How Much Debt Is Too Much?

Shouldn't borrow what you can't pay back--that's how we got into this whole economic mess in the first place. But figuring out how much debt you can take on--or, put another way, how much a lender is willing to extend (for they may not be the same thing)--is a bit tricky.

Source: Dileep Rao, Ph.D., 08.28.09, 04:56 PM EDT, forbes.com
http://www.forbes.com/2009/08/28/interest-coverage-ratios-entrepreneurs-finance-dileep.html

‘Troubled’ banks jumped to 416 from 305

WASHINGTON - With bank failures rising, the government’s deposit insurance fund fell 20 percent to $10.4 billion in the second quarter as U.S. banks lost $3.7 billion.

Source: Associated Press

http://www.msnbc.msn.com/id/32580851/ns/business-stocks_and_economy/

Home sales, durable orders buoy recovery hopes

By Lucia Mutikani
WASHINGTON (Reuters) - New U.S. home sales hit their highest level in 10 months in July and orders for long-lasting manufactured goods surged, fresh evidence a modest economic recovery was taking shape.http://www.reuters.com/article/newsOne/idUSN2625932720090826

Number of Homeowners Late in Paying or in Foreclosure Soars

The number of Americans who are in serious delinquency on their mortgage rose to a record 9.24% last quarter, according to the Mortgage Bankers Association, as the increasing job losses and still-struggling economy forced more people out of their homes.
Meanwhile, the number of people who were in the foreclosure process rose to 4.3% from 3.85% from the previous quarter.

Source: Ken Sweet FOXBusiness

http://www.foxbusiness.com/story/markets/economy/update----homeowners-late-paying-foreclosure/

Consumer confidence rises above forecast in August

NEW YORK (Reuters) - U.S. consumer confidence climbed more than expected in August on an improved outlook on the job market and the overall economy, according to a private report released on Tuesday.
The Conference Board, an industry group, said its index of consumer attitudes rose to 54.1 in August from an upwardly revised 47.4 percent in July. The July figure was originally reported at 46.6.

http://www.reuters.com/article/newsOne/idUSTRE57O3L120090825

Source: www.reuters.com

Fed Extends TALF through June 2010

Appraiser News Online Headlines Last Updated: August 19, 2009 Vol. 10, No. 15/16

In hopes of promoting the flow of credit to businesses and households and to facilitate the financing of commercial properties, the Federal Reserve Board and the Treasury Department on Monday approved an extension of the Term Asset-Backed Loan Facility, or TALF, to keep the government-run program functional beyond its original Dec. 31, 2009, sunset date.

Under the joint Fed- and Treasury-approved extension, TALF loans for newly issued asset-backed securities and legacy commercial mortgage-backed securities has been authorized to run through March 31, 2010. In addition, TALF loans for newly issued CMBS, which can take a significant amount of time to arrange, have been extended to run through June 30, 2010.

According to a joint statement released by the Fed and Treasury, "Conditions in financial markets have improved considerably in recent months. Nonetheless, the markets for asset-backed securities backed by consumer and business loans and for commercial mortgage-backed securities are still impaired and seem likely to remain so for some time.”

As noted in a recent Washington Post story, it appears the Obama administration is not planning to put additional federal resources into the TALF program’s effort to boost the commercial sector, though many analysts believe that’s what is needed as a new wave of defaults on the horizon could impact the $814 billion in commercial real estate loans on pace to mature between now and 2011.

The Fed and Treasury, however, have not ruled out increasing TALF funding or extending the program further into the future. As the government agencies mentioned in their joint statement, “[We] are prepared to reconsider [our] decision if financial or economic developments indicate that providing TALF financing for investors' acquisitions of additional types of securities is warranted.”

For more information on the extension of TALF, visit http://www.federalreserve.gov/newsevents/press/monetary/20090817a.htm.

Source: http://www.appraisalinstitute.org

Pace of U.S. existing home sales fastest in 2 years

By Lucia Mutikani

WASHINGTON (Reuters) - Sales of previously owned U.S. homes jumped 7.2 percent in July to mark the fastest pace in nearly two years, a survey showed on Friday, in a strong sign that housing is pulling out of a three-year slump.

Sales in July rose for the fourth straight month to hit an annual rate of 5.24 million units, the highest since August 2007, the National Association of Realtors said. The total beat market expectations of a 5 million unit pace and June's 4.89 million pace.

Read more at http://www.reuters.com/article/gc03/idUSTRE57K2NV20090821.