Solving the Foreclosure Criss: a Multi-Step Process

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The foreclosure crisis in 2008 destroyed much of America’s wealth. However, with a carefully guided plan, the United States can work its toward recovery. I believe that the responsibility for the prevention of foreclosures starts with the homebuyer and goes all the way up to the government. All parties associated in the process of buying homes share some degree of responsibility for what has happened. This problem gives us the opportunity to fix a system that is in desperate need of overhaul in order to help people from all economic backgrounds.

First, sub-prime mortgage lending practices must cease. This program has allowed people to purchase homes they simply cannot afford. Buyers must evidence a steady flow of income, show a high credit score, and the ability to pay off debt. Loaning substantial amounts of money to people who have no way of evidencing that they are capable of paying off loans is a reckless practice. However, if renters can show that they have paid their rent on time every month in addition to showing the ability to hold a job for a long period of time, the number of foreclosures will decline.

I believe an increase in the value of the United States Dollar is critical to the housing market. When the value of the Dollar decreases in value, people are forced to pay more money in order to acquire goods and services. Consequently, the price of homes increases, limiting the base of prospective homebuyers. A currency with more value is sure to stabilize the value of property, such that more people will be able to become homeowners. There are also many unfortunate byproducts to inflation, such as having more difficulty paying off other loans, which in turn will lower one’s credit score and decrease the...

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...erica. The root of this problem lies with the lenders who practice reckless techniques simply for accruing wealth without considering the ramifications on their businesses and the people they service. Additionally, the American public needs more confidence that home prices will start to increase. Nobody wants to purchase an investment that will decline in value. The prospective homebuyers must also share blame because of the lack of knowledge most people seem to have regarding how expensive of a house they can afford. Perhaps the biggest problem faced by homebuyers is the staggering interest rate that must be paid. I firmly believe that lowering interest rates will greatly reduce the number of foreclosures. Although the answers to this problem will be met with displeasure from mortgage companies, they are steps that must be taken in order to find solutions.
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