Essay on Solution to the Foreclosure Crisis - 2199 Words

How real is the mortgage foreclosure problem in America? How did it come about? What are some possible solutions? First of all, the problem is so big that almost everyone knows someone who lost their house because of a foreclosure, and this is new. It didn’t used to be that way. Listening to the stories of foreclosure evictions provides an eyewitness viewpoint of how it happened. This is important because it provides a background against which to decide solutions. The overhang of foreclosed homes for sale is pummeling home prices and laying waste to entire neighborhoods. In the process, consumer spending has suffered mightily and deepened the recession as Americans have seen the value of their most important assets, their homes, are†¦show more content†¦Ã¢â‚¬Å" In simple terms, a bank lends money to someone who wants to buy a house. In return, the house buyer signs a paper called mortgage which says they will pay the bank back and that if they don’t, they will forfeit their house to the bank. So who are the unwise home buyers, who, having signed that powerful piece of paper, miss enough payments that the bank actually does come in and throw them out and take back their home? I can answer that question two ways. First, statistics show it’s happening right where I live in Lima, Ohio, and Allen County. The LIma News, Dec 12, 209, gives these statistics. Foreclosure rates are now running 1.56% for October, which is just slig htly higher than one year ago (1.56%) but less than it was earlier this year. In actual numbers, there were 895 foreclosures, which contrasts with 800 in 2008, but in 2005 there were only 464. This is slightly better than the national numbers and it might not sound like a lot, but it is a nearly 200% increase since 2005. Thats why we need a proposing sweeping action. First and foremost, the government should make that same 4.5% mortgage rate, the lowest in decades, available to all American homeowners through refinancing. Banks and other lenders would write the loans and then sell them to Fannie Mae and Freddie Mac, the secondary-market giants that wereShow MoreRelatedSolution to the Foreclosure Crisis1326 Words   |  6 PagesI have what I believe to be a viable solution to the foreclosure crisis. I am almost certain that, if implemented, it would work. We need social services reform. I hesitate to say this, because it may come off as sounding too radical, but desperate times call for desperate measures. Simply put, if something fails, we must look at the overall picture and see what may be wrong—we need to troubleshoot the system. To me, and hopefully to most Americans with any interest in the future of our nation, itRead MoreA Practical Solution to the Foreclosure Crisis1122 Words   |  5 PagesIt is no secret the foreclosure crisis has played a significant role in the financial meltdown of the past year. The collapse of the housing marketing has brought thousands of families across the country to financial ruin, forcing many out on the streets. Although the common consensus is that something must be done to stabilize the foreclosure crisis, the agreement ends there. Proposed solutions to the foreclosure crisis have drawn controversy from all political affiliations and walks of life. ThisRead MoreA Solution To the Foreclosure Crisis Essay955 Words   |  4 PagesThe foreclosure crisis has reached new heights since the all-time high deficit in the economy. U.S. foreclosure rates went up more than 81% and 861,664 families lost their homes to foreclosure in 2008 (Les Christie). Also, 54 households received a foreclosure notice last year (Les Christie). So what is the solution? Bold action is needed to address this serious issue. I suggest a â€Å"real estate pause† for a temporary amount of time, similar to what Roosevelt did with the â€Å"bank holiday†Read MorePossible Solutions to the Foreclosure Crisis Essay1179 Words   |  5 PagesThe purpose of this writing is to analyze the foreclosure crisis and offer some solutions to keep people in their homes and satisfy the financial accounting records of the banking industry. With more lost jobs on the horizon and fluctuating adjustable mortgage rates, the foreclosure crisis continues to plague America. A recent report from the Mortgage Bankers Association reveals that 14% of loans are behind or in foreclosure. This is largely due to lost jobs in this volatile economy. Many factorsRead MoreProposed Solution to the Foreclosure Crisis Essay1250 Words   |  5 PagesToday’s America is in crisis; we are in a recession. The greatest factor driving this major recession is Foreclosure many Americans are forced to face every day. In simple terms, the foreclosure crisis was caused by greed in the banking industry and too much optimism of the American people. This resulted in a bubble of subprime mortgage lending, which eventually collapsed once leading mortgage firms in the banking industry such as Fannie Mae and Freddie Mac needed to be bailed out by the governmentRead MoreSolution to the Foreclosure Crisis: Lending Laws1518 Words   |  7 PagesThe current foreclosure crisis in America has directly impacted thousands of homeowners who have lost or are losing their homes. It has indirectly affected nearly every American, as it is the underpinning of our current economic recession. In order to resolve this crisis, we first need to understand how we got to this point. With that understanding, we can look for solutions, and then try to prevent this from happening again. In regards to a solution, I have come up with three steps that could beRead MoreProposed Solutions to the Foreclosure Crisis Essay1038 Words   |  5 PagesForeclosure is a growing national disaster in the United States. Every time you tune in to your local news, there is a new family whose house is being foreclosed. Every time you ride around the neighborhood, there is another house up for sale. There are several solutions to this increasing trend including cutting government spending and cutting funds towards unsuccessful government programs, devising financial plans to assist families by setting up payment plans that they can afford, getting communitiesRead MoreEssay on A Solution to the Foreclosure Crisis2422 Words   |  10 Pageslike to stop foreclosure on their homes, we need to address the root or the heart of the problem, not just a branch or limb. Solving foreclosure would be like putting a band-aid on a wound which needs surgery. The real problem resides in human behavior and governmental policy concerning the environment which we inhabit. So, with this information, I will address how to come about a real solution in terms of preventing foreclosure (and better than that, solving what causes foreclosure) (which is interrelatedRead MoreAn Integrated Solution to the Foreclosure Crisis Essay2100 Words   |  9 PagesForeclosure. 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 theRead MoreSolving The Foreclosure Crisis: Two Solutions Essay1444 Words   |  6 Pagesthe rapid increase in foreclosures across the country. The country’s immense housing crisis can be addressed by referring to not only the accumulating irresponsibility of the individual American loan borrower, but also the growth of greed at the corporate level which led to the financial market’s negligence. To stop the spread of this issue we should look at closer government watch of the market and specifically focus on consumer education. The Quagmire What is foreclosure? Well it is actually