Second the economy would benefit because the banks would have their money paid in full and can begin to start leading again. Third, the relief of the credit strain and not losing their houses would do the Americans some good and the depression rate would go down. The Americans will be able to shop and barrow again but not as much as before because we would not need to. Finally after a couple of years the economy would return to an sustainable state and may even be in an surplus in five or ten years.
It will also keep the homeowner, like my parents, who are feeling discouraged, because they owe more than they can sell it for, from walking away from their investment. This will also give the American people confidence and a greater over-all sense of security. With the increase disposable income, money would be put back into the economy. More money from consumers, flowing through the economy would help every aspect of the economy getting back on track. Submitted By:
This activity will be increased if the government will lower overall income tax rates. Historically, whenever tax rates are decreased and people are able to keep more of their hard earned money, they will spend and invest it in creative ways. Many will start new businesses, invest more, and/or expand existing businesses. All of these activities help our country when we encounter an economic downturn, otherwise known as a recession. As more investors and home-owners looking for a bargain buy homes, the United States will see an end to the foreclosure crisis and home values will return to the levels they were at before the economy “crash”.
If our nation’s banks and other financial institutions were more consumer friendly and less consumed in their avarice, we could possibly solve this national problem within the next several years, also helping strengthen the economy as a whole and returning the United States to its wonderful and flourishing power it once possessed. Have you found yourself or someone close to you in need of financial aid to keep your, his or her home? Does it seem to you that banks and other financial institutions ar... ... middle of paper ... ...o fixed interest rate loans then more and more people would be able to pay back their loans. This is why loans are given out right? So people can pay them back.
How one would get the banks to lower their interest is by explicitly explaining to banks that decreasing interest rates will increase their profitability, because it will attract more citizens who want to be home owners and are concerned about purchasing a house due to the state of the U.S’s present economy. Also, by explaining to the banks that decreasing the interest rates will increase profitability, because it will cause bankruptcy to decrease due to affordable interest rates for citizens, allowing the bank to receive all and full payments from citizens who took out a home loan. Citizens purchasing homes due to low interest rates will not only be an advantage to the banks but for the economy, a... ... middle of paper ... ...techniques from the cash for clunker stimulus program, but in this case the citizens have to volunteer for the town and complete community service in order to receive a stimulus package. The positives of this program are citizens get to keep their home as well as make their community a better place. Foreclosure in America is an important issue in the United States and needs to be ended or decreased rapidly as soon as possible for the sake of America’s economy.
The only option is to get the jobs back. Having major manufacturing in the United State once more will give more people the opportunity to work, feeding the unavoidable supply and demand money cycle. The more jobs there are, the more revenue the government makes, and the more money that goes through the economy. Knowing the past history of banking issues and foreclosures, along with what has and hasn’t worked in the past is the only way to find an answer to the current foreclosure problem at hand. In the past finding and or making jobs for the unemployed helped revive the national economy, and lessened the number of foreclosures, because people could pay small increments to the banks.
To sell a house, there must be an able buyer. American's should not buy a house without the prospect of a future of steady income. Therefore, the government must allow the industrial and business sectors to thrive. By reducing corporate taxes and providing incentives for foreign companies to set up shop in America, this can be done. With more job opportunities on the horizon, Americans will feel more confident that they can afford a home.
A program such as this would have multiple benefits including lowering the principal balance on the troubled mortgage, temporarily relieving the debtor of payments if they are unemployed, and keeping the banks well capitalized until a recovery has taken hold. The private sector has a great opportunity to win over public opinion, keep people in their homes, and save the middle class. It is time for the leaders of the private sector to prove how their financial innovation can benefit the larger economy and the public good.
If we were able to take the mortgage out of the picture and make homes rent able and one day own able to the people that stay throughout the long term renting of the homes. This is a great way even for the government to hold property, but not forever. For the government to turn over the homes really give incentives for people to stay in the home and to continue to pay the rent for the home until the rent accumulate to the payoff of the purchase price. This way the government will have to market power to jump start the financial market and get everyone spending and investing for a better future. In the end, everyone wins and money will not be a issue in this foreclosure crisis.
According to the Associated Press, the only time the savings rate was negative prior to 2006, was once in 1932 and 1933 during the Great Depression. With the decrease in savings during the housing boom, 100% financing coupled with low interest rates made homeownership more affordable for many Americans. As the demise often comes, greed fueled the banks to make more loans available to more people with more “creative financing.” Loans were now being offered without money down, mortgage insurance, or even with a regular fixed interest and principal payment. Banks were making exceptions to their otherwise steadfast underwriting rules. The mortgage professionals creating and closing the loans were compensated for closing loans, not turning them away, thus became incented to request exceptions and push through loans that probably should have been denied.