Exploring the Foreclosure Crisis and Steps to Ensure That This Type of Crisis Does Not Occur Again

The bursting of the housing bubble, known more colloquially as the 2008 mortgage crisis, was preceded by a series of ill-fated circumstances that culminated in what has been considered to be the worst financial downfall since the Great Depression. After experiencing a near-unprecedented increase in housing prices from January 2002 until mid-2006, a phenomenon that was steadily fed by unregulated mortgage practices, the market steadily declined and the prior housing boom subsided as well. When housing prices dropped to about 25 percent below the peak level achieved in 2006 toward the close of 2008, liquidity and capital disappeared from the market.

Since the Great Depression, our economy has not seen such devastating downturns. As a result, many of us have lost our jobs and subsequently, our homes. The current foreclosure crisis is affecting 1 out of every 5 Americans, Jonathan Lain (How to Solve the Foreclosure Crisis). So now the focus is on finding ways to solve the growing epidemic of foreclosures. I propose that the government fund a non-profit organization, whose mission is to reduce the number of foreclosures among the American people. Furthermore, although the initial funding would come from the government, as a non-profit, the agency would be able to obtain grants and hold fundraising events in

The foreclosure crisis that took over the United States a few years ago left many people facing economic hardships. This crisis happened because there was a huge housing bubble that was unsupported by actual home values. The bubble began bursting in spring of 2008 and the crisis culminated in mid-2009. Many lenders went out of business and many home owners began losing their homes. When the government became aware of this problem and began to implement new programs, it was already too late for many homeowners. Those homeowners are not at a point where they might be considering buying a new home. The housing crisis has created new rules, regulations governing the mortgage industry, and has also created a new agency dedicated to consumer protection. This consumer protection agency is called the Consumer Finance Protection Bureau. These dramatic changes have helped to create more responsible lending. The improving market conditions such as low housing costs and competitive interest rates are allowing those affected by a foreclosure to become homeowners again. Prospective buyers have a multitude of programs available to them, so even those with less than clean slate have several options.

The insolvency seen in the Housing Market manifested in the large number of stagnant foreclosures caused a dramatic decline in housing prices, which resulted in many homeowners owing more money on their houses than they are worth. Market-level insolvency is caused by capital flight in a specific market in response to a scare during a decrease in solvency. During the scope of this recession, the initial, progressive decrease in solvency was caused by a negative Net Capital Outflow in conjunction with the cash-vacuum produced by the US Budget Deficit, and the scare was caused primarily by the failure of several significantly-sized corporations and a rapid increase in foreclosures caused by the loss of a large number of jobs.

This way the government could stabilize the market and only the houses at the top would be left unoccupied. These top tier homes could be offered for sale or for rent if a sale is not possible. A new loan could be made for the trade down, but the members of the family would be required to take a class on how to save and create financial goals.

When one thinks of the American dream, a nice home with a loving family and a

The same way that President Clinton boosted about 67.5% of all American people could become homeowners in 1995, will be the same amount of people that lose their homes potentially putting children out on the street and increasing the unemployed homeless population taking up residence in tent cities, where is the hope now? Now is the time to act and include benefits to all homeowners that still believe in the America Dream. The Government and the Banks need to provide modification programs to all homeowners to reduce their interest rates to 4.75% regardless of equity or loan to values. If these homeowners who are currently 200% loan to value, care enough to strive to make every payment timely but are in loans that are coming due or ready to adjust, the industry owes these homeowners the right to a loan that they can afford and maintain regardless of the economy. Each homeowner in America is surrounded by foreclosed properties or short sales affecting their value and impeding any ability to successfully sell their properties.

The mortgage crisis we are experiencing in the United States today is already ranking as among the most serious economic events since the Great Depression of the 1930’s. Hardly a day goes by without a story in the newspaper or on the cable news stations reporting about the increase in the number of foreclosures across the United States. The effects of this crisis have spread across all financial markets, where in the end all of us are paying a price for this home mortgage crisis. When the housing market collapsed, so did the availability of credit which our economy depends upon. The home mortgage crisis, the financial crisis and overall economic crisis all need to address by the

The foreclosure crisis in America has impacted everyone- even those who don’t own homes. Our nation is currently struggling with high unemployment, a relatively illiquid credit market, and a deficit that raises serious concerns about the value of the US Dollar in the not too distant future. With interest rates already at historic lows and the government pursuing an unprecedented policy of quantitative monetary easing, options for government intervention are limited. While there is no simple solution to this problem, I think that we must look at the reasons the housing market went into crisis, and based on that develop a regulatory system that will allow us to avoid another situation like this in the future. If Americans believe

According to Desmond, Arleen is not alone in her dilemma. A great many Americans are being evicted in light of the fact that they cannot pay the rent (Desmond, 2016,p 4). Like Arleen, many poor families are spending the majority of their income on rent and utilities. In fact, using estimates from The American Housing Survey (AHS), 1991-2013, Desmond finds that, in America, most poor renting families use over half of their income on housing; and, roughly one quarter spend more than 70% of their income to pay rent and utilities (Desmond, 2016, p 4). Aside from the fact that Arleen’s monthly welfare stipend of $628 has remained stagnate for years, housing costs have soared. Due in part to the foreclosure crisis, and the deluge of millennials into the rental market, the demand for rental stock has risen.(Sisson, 2016). At the same time, escalating building and labor expenses, and declining subsidies, have helped to slow new construction. Thus, demand for rental housing is exceeding supply, resulting in escalating rent prices. Furthermore, the razing of older public housing projects and defunding of government assisted housing has pushed poor families into the private rental market (Sisson, Patrick may 19, 2016). As a result, most poor families in America today live unassisted in the private housing market. In fact, in 2013, 67 percent of poor renter households did not receive federal housing assistance (Desmond, Matthew, 2015). One day, Arleen stopped by the Housing Authority

There are many reasons a person can end up in foreclosure. Many people were victims of predatory lenders, whom they trusted to have their best interests at heart. These lenders misled homebuyers and helped them achieve loans for purchases that were beyond their budget.

“Shit happens” is probably what most of these foreclosed homeowners hear after they were forced to leave their comfy home. Even though the economy is unpredictable, not a lot of the victims are satiable by such a vague expression that has caused them to lose their property. It’s a harsh comment, but the economy has turned into something that we have little influence over. One of the worst feelings is having minimal control over the consequences and outcome. Some people are afraid to make the same home-buying decision again as a result, because what’s stopping the economy from taking another shit on them again? The answer is probably nothing, but what are some actions these homeowners can take to ease into settling down in a home again? Foreclosure victims can try to improve their credit score and it could get them that approved private loan in return if needed. Saving money is also a general option for those that tend to spend a lot on luxury retail goods. Another option can be utilizing the rent-to-own option to have that ‘homey’ feeling as soon as possible. Some people can also test their patience and attempt to wait it out until the economy exits the lavatory.

A few years ago when the country was in a terrible state, home owners were losing everything they ever worked hard for. It was a terrible time in our country that we do not want to see happen again. Foreclosure became a new horrible trend around the nation. All over the news casting stations we saw videos or pictures of people losing their homes. It was a rapidly, devastating event in America. As the economy begins to rebuild and develop, new methods to provide everyone with another break is flourishing. The innovative development that is reaching the population is the rent-to-own a home plan. Boomerang Buyers, are people with a countless gains that goes from either renting to owning a home within a few years, are in various programs to become a homeowner again. It may be a long procedure but the rent-to-own plan is a resourceful, practical and keep plan to consider as an idea.

When the real estate value began to drop in 2007, hundreds of thousands of Americans were evicted from their homes through foreclosure or short sales; giving way to one of the deepest economic collapses in more than half a century. Now a large amount of borrowers are starting to bounce back. Like a boomerang, these battered borrowers are re-entering the home market after years of renting, nursing their credit and saving enough to buy again; but in a economy like this that we could say now is sort of “stable” is it smart going all in on another mortgage or better going with the “rent-to-own”.

Brooklyn, NY – December 30, 2009 Foreclosures continue to rise drastically across the United States due to the recession, and have effected, and continue to affect thousands of families and individuals every day. One aspect we must take into consideration is that most people are not informed of what foreclosure means, or the process, even those who are homeowners. I believe that one step to preventing foreclosure is to educate first-time homebuyers. In addition, first-time homebuyer programs should not only assist potential buyers with financially preparing them to buy a home, but to keep the home once