When everyone started to believe that the country has weathered the storm of the financial crisis that had its roots in the housing market, problem has again erupted in the housing market. In early October 2011, mortgage rates in the country declined to the record low levels. Freddie Mac, the leading mortgage lender in the country, has reported that the most representative mortgage rate, that is the average rate for a 30-year fixed loan, declined to its lowest level of 3.94% in early October.

Rates on 15-year fixed rate mortgages, which borrowers prefer as a refinancing option, also touched the record low of 3.28%. US President Barack Obama, who is battling many serious macroeconomic crises, predicted that it would “Probably take this year and next year for us to see a slow appreciation again in the housing market.” But, currently the housing market in the country is likely to witness a lull, despite very low mortgage rates.

The low mortgage rates in the country can be attributed to the declining confidence in the economic outlook of the country. This has resulted into borrowings very cheaper. This is particularly so because demand for borrowing declined dramatically. Even a year ago or so, when the economic outlook was not as bleak as it is now, mortgage rates were not sky-high too. Home sales were also at a very low level during those periods. The same trend is continuing now also. The aftershocks of the housing market crash of 2007-08 have not been eliminated completely. Lending institutions in the country are now very vigilant and are scrutinizing loan applications very rigorously than ever before.

The political doldrums in the Middle East, Euro crisis, the catastrophes in Japan and of course the acute debt crisis in the country itself are not doing any good to the insipid activity in the mortgage industry in the country. The decoupling theory has been proved wrong once again. And the mortgage rates are closely linked with the overall conditions of the US financial markets, which in turn is again linked with the financial markets around the world. Moreover, recent global unrest has led to widespread sell off of stocks and investors flocked to the safer form of investments. In other words, investors have put in their money into the safe haven of treasuries and bonds. This has invariably resulted into lower yields on these safer investments. This has, in turn, been reflected in the declining mortgage rates.

Anyways, low rates are good news for the people who can afford to buy home or are in a position to refinance. But in actual practice, low mortgage rates have done very little to bolster the confidence in the sagging housing market. Mortgage rates track the yield on the 10-year Treasury note. Ailing US economic outlook has led many investors to shift money from stocks to the safer haven of bonds. This has resulted into Treasury yields to reach historic low levels and same has been the case with mortgage rates.

Theoretically, low mortgage rates should provide a boost to the troubled housing market. Though the mortgage rates have been below 5% for nearly 2 years but these did not result into improved home sales. Whatsoever, many people can’t take advantage of low mortgage rates because of the tight lending conditions. Banks and lending institutions are now insisting on larger down payments and higher credit score. This persistent weakness in the housing market and US unemployment rate of over 9% are likely to keep a lid on the refinancing activity despite the ambience of very low mortgage rates. The truth is that though lower rate of interest can help borrowers to save more but it does not at all make the borrowers eligible for the mortgage loans. Whatever be the rate, the borrowers have to pass through the stringent lending conditions stipulated by the lending institutions. Moreover, low rate do not at all alter the negative equity of the borrowers on house and it does not help the borrowers sail through the crude realities of the mortgage world.

Whatsoever, many experts are of the opinion that the low rates scenario is temporary in nature. This may be the climax of the low mortgage rate episode. In fact, the yields on the 10-year bond are edging up slowly and gradually. Moreover, with recovery in the global economic situations, the rates are likely to come to the normal levels.

• the Interest Savings Queen (interest in you? not saving that; I have lots of interest in you!)
• the Mortgage Savings Queen (catchy, but I don't do mortgages so don't call me for a cheap one)
• the Mortgage Riches Queen (I like the positive sound of this; people would rather be rich than save - get money instead of not spending money)
• then there's the Financial Literacy Queen (Suze Orman might have this sewed up, but the little I know is better than what I've heard her say. We do have a lot in common, however.)

Why pick a name for myself? So I can reach more people. I am an authority on mortgage acceleration and using your house to pay for your house. I've been doing it on my own home long before most of the companies selling software to help you do it were even a twinkle in their papa's eye.

I've been recycling my own money for about five years. Spend it to make a house payment. Pull it out of the house and make another house payment. Pull it out again and pay other bills. (Cool, eh?)

Maybe I should go for the Green Money Queen. What do you think?

Equity cycling is the technique I used to cancel nearly $70,000 mortgage interest in only two years - not counting my regular payments. I've continued to use the technique since then and teach it to hundreds of others.

Equity cycling is simply using your home equity in a revolving manner to…

1. hold on to your monthly income longer
2. move chunks of money where they're most advantageous to you
3. take advantage of the velocity of money by applying larger amounts of cash to your mortgage principal or other debts
4. maintain liquidity so you have access to instant cash for emergencies

Cycling equity can also be used to quickly pay down any type of interest-bearing debt. Any time you avoid interest payments, you're saving money. Benjamin Franklin said, "A penny saved is a penny earned." What about "a penny not spent"? Sounds like 2¢ to me!

Debt-free persons are able to use equity cycling to advance their investments.

If Equity Cycling is new to you, look into it. Better yet, attend one of our upcoming webinars to learn how to use equity for a debt-free lifestyle - the basis of building wealth.

I can't tell you how many clients I have who are $50,000 in debt - or more - besides their homes and investment properties.

Get out of debt, people, as fast as you can, while you can. While you have a job. While the dollar is worth what it is. We're coming into the holiday season now, but remember, Thanksgiving and Christmas are just days…they aren't whole seasons…three months of indulgent spending! I'm not suggesting you skip anything you need, but do not go to excess. (You may not need to buy new dishes to serve your holiday meals.) Focus on essentials.

And if you do feel indulgent, please contribute to your local food bank. People who've not asked for a handout in 55 years are lining up at food banks for help. Locally, they tell me they need staples like cereals, peanut butter and tuna. And they all anticipate being dozens short on turkeys this year. Call your local food bank first if you want to, but I think they'd love it if you buy the two you can get on sale extra cheap and drop them off with some canned goods.

The 80s decade of me-me-me and indulgence is over. The dance like it's 1999 decade is over. It's time to get our own houses in order and stretch a little to help people around us.

Please pass this message on.

PS: If you'd like a free demo of mortgage and debt elimination software, please email me. We'll connect you to a mortgage acceleration agent.

Credit is tighter, to be sure. In order to borrow money for a home these days you'l need a decent credit score and a down payment, probably 20%. That's the way it was before the foxes started guarding the henhouses. People saved up for years to buy a home. Maybe their parents pitched in some money to help with the down payment.

Unfortunately, in the last few years 80/20 or 80/10/10 home loans became popular. That simply means you borrow 80% of the price of the house for the regular mortgage, nothing unusual there, then borrow 20% to make the down payment so you will qualify for the 80% you just borrow. Or instead of one 20% loan, you might have two 10% loans.

Any way you slice it, that's 100% financing. People who got those loans thought their mortgage broker was very clever. "Out-foxing the system."

Why did lenders used to require 20% down? So you wouldn't be tempted to walk away and leave your $80,000 there if things got tough! Over a million buyers have walked away in the last year, either willingly or unwillingkly. About 1.2 million homes are in foreclosure.

So when people call and ask, "Will I be able to get a HELOC to do the equity cycling thing you talk about?" my answer is simple. "If you have good credit, and equity in your home, there should be no problem." (One other consideration is total debt load.)

What the collective consciousness seems to have forgotten is that not everyone has bad credit. Not everyone is over-extended. Not everyone in the middle class has three cars, a truck and a motorcycle. About a third of homeowners own their homes free and clear. And the percentage of people who want to be debt free, including free from mortgage debt, is growing.

They'll have perfect credit and no debt.

Are you thinking that advice would have been more valuable in the have-it-all eighties? Or the looking toward the millennium 90s? Or even the early years of the whew-we-made-it-to-the-21st-century?

You can't unspend what you've already spent. You can, however, stop spending. I read recently about people experimenting with going an entire month without purchasing anything. Eat the canned goods you have stashed about. Carpool. Skip the movies. As I recall, it quit being fun after about a week. Day 11 had a come-to-jesus moment.

But today's blog is about getting out of debt, that elusive "get-out-of-debt-free card" we'd all like to find. Sure, it will cost us something to get out of debt. We might have to pay our bills. But if we pay them quickly, we will save thousands and thousands of dollars.

I coached a young couple yesterday as they put into place an aggressive payment schedule. They'll save a million dollars. Furthermore, if after they are out of debt, they keep making payments, but to themselves or modest investments, they'll have a million dollars saved up by the time they would have gotten out of debt had they not stepped up the pace. That's a difference of two million dollars! That's better than free; that's a plan that pays!

Have you already made changes to your budget, your spending, your debt payment strategy? Are you paying off your mortgage, too? You know the faster you do that, the faster you can start saving for anything you'd rather spend your money on than mortgage interest!

Let me hear from you about what you've done and what you've planned. We can do this thing!