Foreclosure Crisis : A Foreclosure Disaster

The largest cause of unemployment can be attributed to recession. The term recession refers to the backward movement of the economy for a long period. People spend only when they have to. (Nagle 2009). With people spending less there would be less money in circulation therefore, enterprises would suffer financially and people would suffer too. This is so because recession reduces the fiscal bases of enterprises, forcing these enterprises to reduce their workforce through layoffs. These enterprises lay off their workers in order to cut the costs they incur in terms of wage and salary payments.

You solve this by creating more jobs, thus allowing more people the opportunity to work. If we destroy cyclical unemployment, we make a huge stride in solving the foreclosure crisis.

I often used to watch a show called “Extreme Makeover” where a team of builders would come to a neighborhood, build a need worthy family a beautiful new home, and then just give it to them. “Wow! What a lucky family,” I would say. “How fortunate.” However, as time went by, that same family would be in the news again. Why? The house was in foreclosure. The people had gone to the bank and taken out a mortgage against the home, then spent all the money they got for it on other things.

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

Since the burst of the housing bubble, foreclosure practices had serious problems which left homeowners and the economy in a tizzy. Losing a home is not only stressful, but it does not bar you from owning again. After going through a foreclosure, a rent-to own is a perfect solution to get back on your feet and onto a road of recovery. By doing so, you are able to receive a monthly rent credit and lock in purchase price on a new home.

In 2008, an absolute indication of a recession was the decline in auto buying, insurance companies requiring assistance, retail stores closing with massive lay-offs stemming from these markets. As a result, these individuals now unemployed were unable to pay their monthly mortgage payments which resulted in home foreclosures. A foreclosure is legal proceeding that bars or extinguishes a mortgagor’s right of redeeming a mortgaged estate (“foreclosure“, n.d.). In New Jersey, the statewide foreclosure rate is 0.03% and the unemployment rate is 9.7% resulting from the loss of 179,400 high paying jobs that were replaced by lower paying jobs (Mackenzie, 2009, p. 1). It is clearly evident that the crisis of home foreclosure throughout the

The current foreclosure dilemma can roughly be divided between two main groups: homeowners who cannot afford their mortgages due to either a raise in the rate for an adjustable rate mortgage or a decreased home value and

Foreclosure is one of the most difficult things to face. A home is usually the single largest investment for the average consumer and to lose that is very devastating and hard to recover from. Today, I work for one of the largest foreclosure homebuyers in Florida. They buy about 500 homes per year only from the foreclosure auction. This company has been investing since before the crash and they have shared their knowledge and experience with me over the past two years so that I don’t make the same mistakes they did. Some of the most important lessons they learned from the crash are as follows: Don’t invest outside of what you know just because everyone else is doing it; don’t over-leverage your properties by taking out multiple mortgages

The foreclosure crisis is the worst seen by the United States in all of its history. The fact that thousands of people have lost their homes is a sobering thought. There are several reasons why foreclosures happen and they all point toward the mortgage companies, banks, the economy and the Federal Government. Still, finger pointing and blaming is not the solution. The time has come not only to fix the problem immediately, but also to provide safeguards to prevent it from happening again. This requires nothing less than a strong hand from the government.

So your job is a key factor in how our economy is doing. Unemployment occurs when a person who is actively searching

Foreclosure. Only recently has the term become a buzz word among the American public and various media. The crisis that has enveloped the United States has initiated widespread questioning of the very financial systems in which the American innovators have grown to prosper. Although the foreclosure crisis is often viewed as a product of greedy financial institutions, causation cannot be distilled to individual constituencies; further regulation on various components of the crisis can develop the preconditions for recovery, but 2009 has elucidated a stunning reality: the American financial system possesses an independent resiliency that is currently rebounding and developing recursive and futuristic solutions with minimal exterior

Again, there were certainly many people who bought homes that they couldn’t afford and used their equity for loans like there was no tomorrow. Therefore, the foreclosure was sort of a formality and an appropriate action by the banks in those cases. Although, there were many responsible people who bought affordable homes, but got behind on payments after the economy crashed. Normally under those circumstances the bank has an incentive to keep borrowers in their homes because foreclosure is generally a costly decision for the bank as foreclosed homes are sold at a discount on the open market. However, many lenders have a perverse incentive to foreclose on a loan if the loan is insured through various investments such as derivatives and government guarantees. That insurance pays the lender the full price of the loan, instead of the reduced price from a sale on the open market. Thus, in a predictable fashion, the homeowners with loans that were backed by insurance have been foreclosed upon at significantly higher rates, as opposed to the borrowers with loans without insurance.

The foreclosure crisis all boils down to lack of knowledge. Real Estate as any other investment entails risk and uncertainty. No one can foretell how much return an investment will make, or even if there will be a return at all. Risk is only matched by the size of the investment, where higher risks are taken for investments that have a higher possible return. That said, as Real Estate will undoubtedly be the largest investment for most of the population, it will definitely have the highest level of risk for most people in the population. Risk will be inherent in any investment as no one can be certain about the future; however risk is maximized by ignorance and minimized by knowledge. It is ignorance that has led to ill-advised home

Over the years, Unemployment has been on the rise and although there is a percentage of people who simply don’t work, there are many unemployed ones who actually wish to find a means of work. Due to this fact, Many may ask what causes unemployment and what programs counter this problem. This essay will cover three points. What is unemployment and what causes it to rise or fall?, What unemployment programs exist to counter unemployment?, and How can you be eligible to receive these unemployment benefits?