First, I live frugally, have since my second divorce left me with house payments, spousal support, child support and various other incidentals. I quit smoking at the time. Two packs a day at $1 a pack was $60 a month she couldn't get at. And I still don't smoke.

There is a real demand for bridge loans out there, folks who want to buy real estate at marked down prices but those houses don't quite qualify for mortgages. With a little work they will.

I heard of a guy who is in that position. He wants to pay $140 for a house appraised at $200 (thousand). The house needs about $5,000 work to bring it up to standards. He was offered $145,000 to buy the house and effect the improvements.

The lendor would write up a mortgage for $145 + 16% due in three months, or the house reverts to the lendor. In this market the house would rent for more than the mortgage payments should the borrower not complete the deal.

A friend of mine made a better offer to the fellow. And from what I understand there are more of those out there.