Making Home a Home: Solving the Foreclosure Crisis

Making Home a Home: Solving the Foreclosure Crisis

Foreclosures have always been a fixture of America’s economic landscape. Unfortunately, the prevalence of foreclosures today has warranted the use of the word “crisis.” This crisis is not without its nuances, however; it is far from monolithic. While all foreclosures have the same result and usually involve sad families evicted from their homes, this crisis has had three distinct waves, each with its own (and sometimes overlapping) causes. As per the New York Times, the first wave was due to speculators and falling real estate prices; the second wave was due to risky mortgages, whose interest rates rose higher than the homeowners expected; and the third wave has been due to unemployed families unable to make their mortgage payments. Since the last wave is the current one and thus the one needing solutions, the third wave is the one I will focus most on.

In addition to being the most current, the third wave has the most potential to grow. The population of speculators and people who took out risky mortgages pales in comparison to the population of homeowners who have standard mortgages and depend on their work to keep up with payments. For these homeowners, any break in employment can force them to delay or even miss mortgage payments. Their foreclosures are the most unexpected. These homeowners were not looking to make a profit and took out prime mortgages. They have played by the rules and worked in order to have a home. In addition to reducing foreclosures, one of my goals in solving the foreclosure crisis is to keep these homeowners housed. Though the two goals seem similar, the policies I want to see set in motion will clarify the difference.

As mentioned e...

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...t to make sure banks are not benefiting unduly in my plan by modifying the mortgages unreasonably, so my plan calls for more regulation.

While my plan may seem naively straightforward—superficially, simply suspending foreclosures—I have outlined reasons why my plan benefits all involved. Foreclosures are not advantageous to either banks or homeowners, but there did not seem fair way to end them. My plan is fair and would present both sides with a solution they like. By taking an easy-to-understand idea and elaborating specifically on the negative effects of foreclosures, I can persuade the banks; and, by prioritizing keeping families in their homes, I can persuade homeowners. I do not simply want to make homes affordable, as per the current legislation. I want to make houses homes. I want to end the foreclosure crisis, and I believe my plan is a step to take.