President Obama’s real estate stimulus plan is here and I’m not altogether happy about it.  I recognize that the country is faced with an unprecedented crisis and extreme action is necessary. And I’m glad he’s taking action.

With regard to real estate, what this means is that there is a potential tsunami of foreclosures headed this way unless something can be done about it.  And that is the heart of the real estate plan.  Without a doubt, it will take a lot of luck for this plan to achieve it’s goals.

The plan may help prevent foreclosures by reducing monthly payments.  I say “may” help because the Bush program did not provide much help.  Many people could not qualify for that one, and many of those that did were back in default on their loans in 3-6 months.  That’s not much of a fix.  I certainly hope Obama’s plan will work better than that.

What bothers me is that I have been sucked down by the real estate market as more than most people and I’m not eligible for any relief.  I took a substantial chunk of my savings and made a 20% down payment so that I could reduce my loan amount to an affordable level.  Unfortunately, I had the poor judgement or bad timing to buy in February 2006 at the height of the real estate market.  Although I got what appeared to be a good deal for that timeframe, it’s not looking very good right now.  My property is down 40-50% and there’s nothing I can do about it.

Getting back to Obama’s plan, I’ve been fiscally responsible and yet due to market forces all my equity has been wiped out and I’m underwater by 20% or more.  As such, I owe too much to qualify for help.