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Freddie Mac Approved To Buy Second Mortgages

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on Monday, 24 June 2024
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Regulators have approved a pilot program that will allow Freddie Mac to buy second mortgage loans.


The $2.5B pilot program over the next 18 months is relatively small, yet, if it grows, could have a significant effect on financial and real estate markets.


What Happens When The Government Buys Mortgages?

Whether the government, or government sponsored enterprises buy or insure financial instruments like mortgages, it has two main results.


Firstly, it reduces risks and weight on banks. Secondly, it shifts that risk to whomever is now liable for it. Which is really the US taxpayers. Assuming that if there is a failure, they will be bailed out like in 2008.


When banks and loan originators are able to pass on the risk of how loans perform, and are able to sell them and recapitalize, they are able to make more loans, and are confident in offering easier to get loans, with more lenient underwriting criteria.


This could make second mortgage loans more widely marketed, and easier for homeowners to get over the next year and a half.


Why Now?

Many savvy investors may believe this move comes at a questionable time.


Banks are still reporting billions of dollars of nonperforming mortgages on their books in 2024. Home equity lines of credit are performing far worse than fixed second mortgage liens. Though interest rates are also high. This also comes at a time when many believe home values are or are about to begin coming down.


Consumers are also already grappling with high inflation in living expenses, and to keep up with other debts. Like credit cards and auto loans, which have been defaulting at increasing rates.


What Can We Expect?

This move may ease banks positions, yet create more low equity and underwater mortgage situations for homeowners, and eventually foreclosures.


Now is a good time for real estate investors to reach borrowers, and educate them on the advantages of selling their homes now, versus borrowing more and struggling to keep up under the weight of more debt.

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Is A Four Day Work Week The Key To Better Productivity?

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on Wednesday, 25 January 2023
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A new study shows that a shorter, four day work week may be exactly what you need to be more productive.


For many years we’ve been catching up with new studies that reveal working fewer hours is actually better for everyone. Not just the individual workers, but businesses that employ them, and communities too.


Now the data suggests that not only is working fewer hours more beneficial, but so is working fewer days.


This new study covered by Bloomberg reports that the four day work week could be the recipe to avoid burnout and boost productivity.


Avoiding Burnout

While many dismiss the importance of this, it is far more impactful on your health, business, relationships, and finances than you think. The time to address it is not once you hit it or see the negative impacts. The goal is to avoid it in the first place.


A four day work week can reportedly improve sleep and help avoid burnout. This means you can continue to love your work, do your best work, make better decisions, and enjoy a better life. Forget ‘work life balance’, it's just life.


Boosting Productivity

This part may be far more attractive to the workaholics reading this.


Being more rested and energized to work during these fewer days can certainly drive you to work harder and better when you are working.


It also forces you to find ways to be more productive and get better results in less time.


It’s For Your Teams Too

Don’t forget, if it is good for you, it is also good for your team members.


There is no use in you only working four days, but making your employees work seven. You won’t get the results.


The CEO of Randstad says that it is imperative for businesses to have flexibility today.


How To Do It

Find the four days that work for you. Perhaps that is avoiding those dreaded Mondays altogether and skipping right to Tuesday. Or it might be eliminating Fridays as little gets done after lunch time anyway. Or you might break up your work week and take Wednesdays off.


Experiment with it, and find your rhythm.


What To Do For The Other Three Days A Week

This might be the most difficult for some. You should absolutely take one full day of rest. You may use another to learn and improve your skills, focus on making other investments, or work on your hobbies. You can travel to expand your mind and check out new real estate markets. Or you can even teach others how to do what you do, and volunteer your time to good causes.

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