Our nation today has become spoiled with instant gratification. Loans and the borrowing system have given the idea that patience is no longer a virtue and that saving is no longer necessary. Material wealth is increased, but so is the idea of false wealth. People have become so bloated with it; therefore they take on more than they can afford. That is what has happened with our nation’s recent wave of foreclosures. Loans have led everyone to believe that they can own a home and it has omitted the practice of saving. That is where the beginning of the solution lies. Our nation’s people need to relearn the value of patience, therefore we need to learn how to start saving again because although loans may pave a way toward homeownership, it is not valued as much compared to someone who has saved for a home.
Foreclosure is defined as “The legal process by which an owner's right to a property is terminated, usually due to default” and it “typically involves a forced sale of the property at public auction, with the proceeds being applied to the mortgage debt.” (Foreclosure 1). Ultimately, it begins when the owner of a home is unable to make the required mortgage payments every month, therefore the homeowner falls in to default. The borrower receives a notice of default which warns that legal action will be taken soon. In most cases, one may not know what to do, and the only “solution” available may be to walk away, or let the bank take the home. Foreclosure was at it’s highest during the summer, with “one in every 355 U.S. Housing units” receiving a foreclosure filing in July. Also in July, “For the 31st consecutive month Nevada documented the highest foreclosure rate”. California, Arizona, Florida, and Nevada account for ...
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...tions may not immediately and completely end our current foreclosure problem. Hopefully, it will be the beginning of a solution to the on-going problem of borrowing money, attacking the core of where I think the problem really lies. Americans have always been known for their resiliency. If only patience can be developed as well in this time of economic crisis that could very well lead to a long term solution. By acquiring property that is paid off, they will be able to relieve themselves from future pains. Because most Americans cannot help the economic state, they can help themselves by preparing for the future and whatever it may bring.
Works Cited
Foreclosure “foreclosure” Investorwords.com. InvestorWords.com, Web. Dec. 30 2009
RealtyTrac Staff. “U.S. Foreclosure Activity 7 Percent In July.” RealtyTrac.com. RealtyTrac, 12 Aug. 2009. Web. Dec. 30 2009.
For the decades before the current housing crisis, buying homes and loaning money was a simple, but strict, affair and had had two outcomes. Either the borrower could pay back the money owed or they could not pay the money back. If the borrower could pay the money back, they could keep their house or whatever they took out the loan for. If they could not pay the money back, the lenders repossess the things that were not paid for. When this happens with a house, it is called foreclosure.
The country is certainly in crisis, but the crisis is not being caused by mortgage foreclosure. Foreclosure is simply a mechanism for people to deal with a debt they can no longer afford. Rather than being a crisis, the potential onslaught of home foreclosures (which has been slowed somewhat by the Obama administration’s “Making Home Affordable” program) is actually market forces hard at work cleaning out the mess in the real estate market caused by too much cheap money loaned to people who were not sound credit risks to buy homes they could not afford. When home prices are completely out of line with wages and people who would normally have a hard time getting a friend to loan them $20 are able to take out interest-only loans to buy over-priced housing, something is very, very wrong. While it may be painful for many people, the real estate market collapsing, including thousands of inevitable foreclosures, is not a crisis, but rather a result of the real crisis – unserviceable debt.
Between 1997 and 2006, the price of the typical American house increased by 124%. Many people assumed that this trend of increasing housing prices would persist.
...ere is still financial problems they face. The article also states that “U.S. home values continue to rise as buyers compete for a limited supply of properties for sale (Jafari, 1).” In other words the competition is still there. Many are wanting houses, and there is either too many buyers or not that many houses for sale. So not much has really changed.
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...
In the United States we face many issues such as poverty, death, health, and many others. But the issue that is currently effecting society the most is foreclosure. What is foreclosure? How has it effected society?. The definition of foreclosure is a legal or professional proceeding held by a lien holder which is a court order termination of equitable right of redemption amongst housing properties. Foreclosure has not just effected us financially, but has effected society physically.
I wonder if as a family opens the door to their new home, a place where they have holiday dinners, celebrate birthday parties or just are able to say “Home”, understands the importance of their investment. One of the most important investments in a person’s life is purchasing a home. Whether it’s a first-time home buyer or a veteran, buying a home is a complex process. Figuring out how much you can afford, learning your rights, shopping for loans, these are a few steps in the home buying process that when learned correctly, can produce a successful homeowner. Learning how to take care of something as special as a home takes time and effort from all those who are present in the home. As the country deals with the economy and the war, the last thing America needs is more homeless people and the rise of the crime rate. Two ideas I have come up with to help solve the foreclosure crisis is to add a investment course to the high school curriculum across America and insurance companies creating an insurance package that consolidates home and auto insurance at an income base rate.
There is a solution to the Foreclosure Crisis. I do not propose that this is my own answer, but that it is born out of Love. The love for all my family and friends and the country as a whole is the reason for this proposal. Their fates and indeed the fates of our way of life in America depend on what we do at this time in history. The admiration and love for the foundation on which this country was established is an additional motivating factor. Needless to say we can neither turn our backs on all those who have shed blood and even given their very lives for the principles of our America. To allow this jewel of freedom and prosperity to falter and deteriorate would be the most monumental political plunder ever recorded. We can not afford to blow this opportunity.
Foreclosure in America has been a rising and prominent problem recently, and has destroyed many Americans hopes and dreams. Over 2.3 million homes were foreclosed in 2008, and an estimated four million homes will be foreclosed by the end of this year. Despite the efforts of many banks and lending companies, over half of homes will foreclose that have received their help. I believe that we have only started in the right direction in solving the foreclosure crisis. Giving money and lowering mortgage rates will help, but I believe we should find out why Americans are in this situation in the first place. We are being too stereotypical when we think the only reason someone is foreclosing is because of irresponsible payments or buying a home out of a person’s capabilities to pay for it. If we understand their situation, we will be better enabled to help and solve their crisis.
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.
“One out of every two hundred homes will be foreclosed every month, making 205,000 new families enter into foreclosure,” Mortgage Bankers Association. The housing industry in the United States is undergoing an unfortunate crisis. There are way too many homes being foreclosed, which cause a ripple of problems.
... main way to fix the foreclosure crisis; education. A concentration on education doesn't mean spend more tax dollars on public schools. I mean increase the quality and target of the curriculum in the schools that do exist. Americans learn of Paul Revere but do they know about Louis McFadden. We learn about capitalism and democracy but do we know how it is sustained. Do we teach and require from ourselves and our children the common sacrifice needed to maintain our way of life. Do we know and understand our rights, not in some superficial manner but in a substantial internalizing way. I think if we did, we would be greater demanders and defenders of such. Property, due process, legal vocational pursuits, and contract rights are such that if not protected, will not only foster more and deeper foreclosure and financial crises, but could end our democracy as we know it.
The housing industry has definitely been on the downswing since the summer of 2006. Home sales as well as house prices are down. Inventories of unoccupied homes have increased and there has been a recent decline in the employment levels of the housing industry. Many economists are of the opinion that we have not seen the bottom of the decline in the Housing Market', which is one of the most important factors of the American economy. Recent statistics indicate that there is an increase in mortgage applications; however, at the same time there is a decrease in permits and new-home startups that could affect the economy for several years to come. In addition, another disturbing trend is the increase in home building cancellations during the last 3 4 months.
A review of the literature reveals a common theme among experts in this field of study. The recurring themes present is the current literature include the financial crisis of 2008 and foreclosure impacts. Foreclosure impacts include the effects of crime, housing sales, property valuation, property abandonment, neighborhood destabilization, and shifts in tax revenue. The sources of the literature reviewed were scholarly journals, peer-reviewed journals and governmental websites. The foreclosure impacts will be presented as subtopics within the body of this paper.
Between 1997 and 2003 the housing market’s share of the economy was 17 per cent or less. Today, it accounts for nearly 19 per cent (Alini).