Readers want to know what effect lending regulations will have on the housing bubble. "What are the chances of the Fed tightening lending regulations on home loans. Since most of our elected reps. are bought and paid for by corp. America I doubt any tough measures will be enacted unless people who have these loans start feeling some pain from lower house prices and rsing interest rates."

A reply, "The chances are slim now, because the new mortgages haven’t been proven yet to be bad, reform will have to wait until the data show that those loans lead to more foreclosures and depress the housing market even more than strict mortgage regulations."

The Chicago Tribune. " There was a period, not so long ago, when the mortgage-refinancing business was so boffo that loan originator Leigh Friedman didn't have time to return phone calls from prospective clients. Not anymore. 'When somebody calls, you get back to them very quickly,' said Friedman, a 10-year veteran."

"'Some consumers are just interested in the lowest rate and the lowest closing costs,' Friedman said, acknowledging that the ubiquitous ads for lenders who tout incredibly low interest rates and no closing costs have added to the competition. 'What I tell them is, it's not just about rate, it's about service. But service just isn't on their lips,' Friedman said."

"And, though they're generally shy about talking about it, more are quietly willing to negotiate fees. The real estate boom also generated a boom in mortgage-industry practitioners. Today, Illinois has about 17,500 loan originators, up from 3,000 in 1993. Their numbers reached 25,000 until last year. 'A lot of people fell out of the business who shouldn't have been there,' said Donna Angarone, a loan originator for 21 years. And she says the numbers are shrinking daily, as Chicago-area refinancings dwindle and the industry watches nervously to see whether the bellwether spring home-sales season takes off."

And from the Tampa Bay area. "The reports seem to confirm that the housing market has cooled. In February, sales of existing single-family homes, here in Florida, went down 20%. But the people who are buying, are using something called an 'interest only mortgage,' It's helping buyers get into that dream home."

"Mortgage broker Jennifer Ewonaitis has advice for home buyers are try to buy too much home. 'That's where the interest only loan comes in. It enables home buyers to to get into a more expensive home. And it's exactly how it sounds. For a limited time, 5-10 years for example, the buyer pays just the interest. But, down the line, that buyer has to start paying off the principal.'"

"'The average loan amount is about $160,000 right now and if you're looking at a 30 year fixed at about six.25 %, then your interest only payment on that is going to be about $154 a month less than a standard 30 year fixed principal and interest...so it'll go up about $154 or it can go up more than that.'"