In the early part of the twenty-first century Americans have been able to get loans for houses that at times seem to be at best risky. For some Americans this was the only option they had in order to complete their American Dream of owning their own home. However for many of these same people and many others the economy went into a downward spiral and many foreclosures have been put in front of many Americans.
Much has been made as to what to do with the people whose homes are now gone or are struggling to keep their home off the foreclosure list. One solution would be to just let them get what they “deserved.” However as easy as this may be to just write a person off this is not the best solution to solve the problem. A better solution would be to set up a repayment system. This would include steps of repayment. First, there would have to be minimum amount of income a person has to make in order to start paying back their loan. For a single person a minimum of $25,000 a year in income should start the minimum payment for the loan. There should be a time limit for how long someone has to get to this point. If someone does not have a job within one year of the start of the program they should lose their house. There are plenty of jobs available in America. These jobs just might not be the dream jobs but there is still work out there. For example fast food is always looking for business.
Even if someone is only able to get minimum wage working they should not lose their home. The government could intervene in their loan and put a hold on their interest and payments as long as their working. After a period of two years start a minimum payment schedule based a low amount to help pay off the loan but ...
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...nse by a small portion. Just by cutting the defense budget by .1% would generate millions of dollars to be used to help pay off the loan companies interest to people.
There is a solution to the loan foreclosure problem besides having the government paying the loan companies money and giving money to the people involved in the loss of their homes. With a little bit of money divereted to where it is needed most the United States could start a chain reaction into helping itself recover. If people can help pay off the loans they put money into the economy, and if they pay off their loans they can put even more money into the economy. Slowly over time the nation could divert the money that was needed to help pay the loan companies to help reduce the national debt. It is not much but if something is not done the other options look grim to say the least.
As of December 29, 2009, the website Foreclosure.com reported that over 2.2 million homes in the continental USA are in some form of foreclosure, 486,323 are in pre-foreclosure and 465,490 have already been foreclosed. Over seven hundred thousand have tax liens against them and 87, 389 have been sold in Sheriff sales. Along with the homeowners, mortgage companies and banks have suffered tremendous financial loss. However, the homeowners lost so much more; they not only lost the roof over their heads, but memories, their self-esteem and their piece of the American dream.
In essence, the problem leading to the foreclosure crisis is the recent decrease in people’s ability to make their loan payments due to job loss and lower wages brought on by the economy’s weak state. Rather than throw billions of dollars at big banks in the hope that they find ways to help the homeowners’ loans, the government should attack the problem through the individual. Simply, the government aid being spent in the hopes of stimulating the economy should be funneled toward reducing the balance of home loans to make the monthly payments affordable for the owner. By funneling the government aid directly to the American home owner in need, the economy would greatly benefit as homeowners regain their footing with their budget because the economy and foreclosure are directly related. When one hurts, so does the other; when one prospers, the other does as we...
I believe the foreclosure crisis will only continue and worsen until we understand the needs of the American public. Giving money is not the answer entirely. Each situation is unique and different from another. What works for one citizen may not be the solution for another. This is not only a financial situation but a social situation in my opinion. If he or she has a legitimate reason why they are in a foreclosure panic, such as death, divorce, sudden medical illness, or recent job loss, then the American government and banks should lend a helping hand. We cannot punish the unfortunate. We have only made a step in the right direction. We need to start sprinting to the finish line, because if we follow these steps, the foreclosure crisis will be gone in a flash.