Solving the Foreclosure Crisis

The frequency of foreclosure in our nation today is dangerously high. The strain from the recent economic downturn has put many families and individuals in a financial chokehold preventing them from being able to make their monthly mortgage payments. Consequently, many of these people feel they’ve punched a one-way ticket to foreclosure. With all these homes being foreclosed on, we face a very real crisis.

The best way to solve this foreclosure crisis is preventing homes from foreclosing one house at a time. The American family needs a simple option to save their home. My solution is based upon the concept of the homeowner paying what they are capable today, with a long term solution for the homeowner to repay the entire debt eventually. If the homeowner can now afford to make the payments, then they can escape foreclosure, rebuild their pride, and be productive citizens.

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...

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...s not apart of many other economic stimulus ideas) By using profits from the future sale of the house, income tax refunds, 401K withdrawals, and a portion of federal endowments, these loans have a very promising chance to be fully repaid.

Thousands of hardworking American families are being dragged down the path to foreclosure with no escape in sight. Despite hard work, they struggle to make the mortgage payments, lose hope, lose pride in homeownership, and eventually abandon payments altogether. We need to revive hope and rebuild the concept of pride in owning one’s own home by helping them make the payments through this plan. My solution does not require mere government giveaways, but rather allows for the recapture of government investments. One home at a time, we can successfully reconstruct the American Dream of home-ownership and end the foreclosure crisis.