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Congress has passed the bill that will bailout banks and financial institutions who have contributed to this disarray in the mortgage and real estate industries.  So, how will the passing of this bill affect the San Diego real estate market? 

As Marc Von Musser states on his blog, the Emergency Economic Stabilization Act doesn’t directly help homeowners or homebuyers, but it does so indirectly as buying habits are driven by consumer confidence.  However, I’m not so sure that people will be so confident just because Congress passed this bill.  I’m not even so sure the banks will even regain trust from the American people - and if they do, it will come back very slowly. 

The question that crosses my mind over and over again is:  Where is the bailout for the people whose homes were lost in foreclosure due to predatory lending practices by these banks?  These people’s credit scores have been mutiliated, not to mention that they have to go back to renting or live with other family members in order to get back on their feet.  Also, why do taxpayers have to pay for the mistakes of Big Bank Executives?  I’m not one to really dwell on all the negative press, but I feel the need to ask these questions.

In theory, the Emergency Economic Stabilization Act (a.k.a. “$700B Bailout Plan”) sounds like it could work, but this seems like a short-term resolution.

MarketWatch has published a summary which explains what the EESA means in layman’s terms.

Photo Credit: Ricardo Carreon