Solving the Foreclosure Crisis

The foreclosure crisis is the second major financial dilemma of the twenty-first century. To solve this, the roots of the problem need to be dug up and exposed followed by replanting with an appropriately improved regulatory system to help build stronger roots for the future. It seems that the free market system can't be free anymore given its intertwining roots extend way beyond domestic to international financial systems. There are two fundamental causes to the latest credit crisis: 1) poor quality securitized mortgages and 2) insufficient underwriting for credit poor borrowers. Secondary (downstream) problems making the financial crisis more complex include underemployment and business failures. Many banks,

The Great Recession of 2007-2009 was one of the most economically disastrous events in American history. The housing market took a significant downturn during this period. People were not cautious when it came to their money and loans. Larger loans were given out to people, even to those with bad credit and low incomes. These large loans caused many homes to go through foreclosure since people were unable to pay off their mortgage debts. These debts were created by banks increasing the interest rates on the loans significantly in a short period. In 2008, foreclosures were up by eighty-two percent. This increase is significant because the previous percentage of foreclosures was at fifty-one percent from 2007. Unemployment skyrocketed, and people

The current financial crisis, which had its roots from subprime mortgage crisis, began to increase dramatically in September of 2008. There have been significant economic disorders in United States alone. Major banks and financial organizations around the world are going bankrupt and writing down billion dollars. Housing markets are falling not just in United States but all around the world. This crisis is truly global and it is spreading like fire. Because of these economic crises, the US Congress came up with a $700 billion bailout plan to buy troubled assets from financial institutions who are struggling financially. Nevertheless, another bailout was proposed and it's the homeowner bailout. It is known that the foreclosure

The American dream is sought after by so many people within the United States. Many people spend an entire life time trying to build that dream and prepare for their retirement. The economic growth within the United States and our American government plays a big part in our future. In the past ten years, the American government has been on a roller-coaster with its housing market. The housing market started to go through a big decline in 2007; construction was falling at an all-time high. From 2000 to 2006 there were around 1.5 million homes that were built each and every year to replace the ones that were in disrepair. If the market was to keep the trend of 1.5 million homes

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.

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

Preventative care is the key to improving the plight of millions of Americans with regards to their standard of care. This is not to say that a large scale health care reform is not necessary, it is. However, whether the United States moves to a single-payer system or completely to a fee-for-service path, preventative care is still crucial. By keeping people out of hospitals and emergency rooms, health care professionals could lower the nosocomial infection rate which balances between 3% and 12.5%, even in developed countries (Health care-associated infections, n.d.). Another example of a preventative measure would be to lower the rate of obesity. This would effectively reduce the source

The foreclosure crisis had to be predictable at some point by the lending agencies. But since there is no undo on what has been done and a bailout is not desired, the lending agencies must work with the homeowner and vice versa to reach a new agreement upon legal documents for repayment of the loan acquired by the homeowner. The lending agency must also actively consider its own budget, both from a balance sheet point of view and a profit and loss point of view. In order to build a stronger balance sheet, the lending agencies should consider using some of the liquid cash to pay off some of the creditors to eliminate debt. Some items such as properties may need to be sold for cash to help with reducing the debt of the agency. And the profit and loss statement should be reviewed to determine if any of the expenditures could be eliminated or reduced drastically. Yes, drastically because this is a crisis for which resolution is needed! The income should then be reviewed to determine various avenues of fund raising to speed up the payoff of any debt the lending agency has incurred.

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

Attention, you just lost more than 50% of your home’s value and since you are in default on your payments the bank has decided to foreclose. The housing bubble in the United States despite the warnings of financial experts, led to a series of events that were exposed as a result of the bubble bursting. In the wake of such financial devastation was the onset of various homeowner relief programs designed to prevent a plethora of foreclosures and reduce further damages to the economy. Unfortunately, many fell victim to this collapse and were not afforded the opportunity to delay the foreclosure process or outright denied any of the available options by their lenders. Despite the negligent lending practices that contributed to high-risk loans being

More middle class and minority families than ever are now underwater in their mortgages, and have zero to negative wealth after the Great Recession that followed the 2000 housing boom (Potts 7). Even those who kept their homes saw their values drop due to the declined neighborhood worth. My childhood home’s peak value was over $200,000, but my parents listed it on the market with the hope of selling for just $175,000 when they wanted to move to lower their mortgage. There were never any foreclosures in our neighborhood, the house is in one of the best school systems in the state, and it had a great location, yet the value dropped more significantly than it had in twenty years. This was a situation many homeowners didn’t know was possible

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

The United States economy has been in trouble for the past couple of years. The foreclosure crisis is a condition that began due to the inability of homeowners to pay their mortgages. Foreclosure is a legal proceeding whereby a lender obtains a legal termination of a debtor’s right to redemption. The foreclosure rates have been increasing for a considerable period and certain steps have been put into place to solve the problem. While the government, financial institutions and the general public are highly aware of the crisis, the steps taken to combat the problem are still not sufficient as the foreclosure rates are still increasing.

During the economic crisis in the early 1890s, farmers complained about low prices, businesses started falling, and wage earners of salary cuts. The most food insecurity that started was when unemployment started spreading and breadlines and soup kitchens became a commonplace. Breadlines was a recession and decline of aid from the government led to an increase in hungry citizens. Faith-based groups had stepped in, to nourish citizens. When this was excruciating for anyone an extra outsized problem occurred; in the 1930s during the Dust Bowl Congress enacts the first hunger relief programs, purchasing agricultural products from farmers to feed hungry citizens and to stabilize markets. In order to solve the problems with food banks in Hoke County, a solution that would enhance the setback would be to manufacture more local and private food banks to ease not only a few people, but all people