The American Foreclosure Crisis

opinion Essay
2312 words
2312 words

Foreclosure is a dreadful aspect of home-owning. The American foreclosure crisis, and its subsequent economic recession, was caused by lateral misguidance on part of private banks, the federal government, and by the millions of people who purchased their homes on credit. Over 900,000 foreclosures have occurred in California alone, making its foreclosure rate the largest and most formidable; as a result of the housing downturn, private banks like JP Morgan and Wells Fargo succumbed to bankruptcy, as the toxic assets they possessed lie curdled and menacing. Stocks tumbled as confidence in our financial system crashed; millions of people lost their jobs in the course of one petrifying year. The lending process was halted, effectively stalling the crediting and lending system that has shaped American consumerism habits since the 1950s.

But this is all well known. The process that led to the foreclosure crisis, the sickly details of the economic crash, and the terms of our recovery have all been mulled over repeatedly. At this point in time, economic recovery still remains as a top priority to the average American. Yet, what hasn’t been decided, or enacted, is how to solve the foreclosure crisis: and in the same vein, how to restore America’s economic tenacity. There must be a combined effort through the three major levels of this crisis – the banks, the Government, and the individual American – in order to stave this crisis in its tracks and start rebuilding a wiser, structured mortgage lending plan that integrates lucidity and sustainability. We must break free of this financial limbo, and finally commit to substantial action in order to solve this predicament.

Current legislation travelling through the United States’ House of Rep...

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...t to our economy and the people. Efficacy and expediency are needed, and this part of the plan will ensure that.


If President Obama and the United States Senate could evolve this two-part plan into legislation, I believe that it would help solve the foreclosure crisis. This crisis is the heart of our economic recession, and it requires a plan that will work, advantageously, for everyone. Every American citizen deserves this prospect of a future; a future which encourages smart consumerism; vertical, rather than horizontal, benefits within our economic structure; and a lucid loaning process where no one is deceived, and money is not squandered, but delegated responsibility. Through these plans, the American government can set an example for the world that it is taking charge of its problems and bringing innovative, constructive change to our new decade.

In this essay, the author

  • Explains that the american foreclosure crisis and its subsequent economic recession was caused by lateral misguidance on part of private banks, the federal government, and millions of people who purchased their homes on credit.
  • Opines that the process that led to the foreclosure crisis, the sickly details of the economic crash, and the terms of our recovery have been mulled over repeatedly.
  • Proposes a solution for the consumer finance protection agency (cfpa), which would be separate from the u.s. chamber of commerce.
  • Explains that the federal government will require every bank to include a consumer intelligence certification (c.i.
  • Argues that a one-time course created by the cfpa outlines the language of mortgage lending, different loan types, the nature of interest rates and the economic market, as well as the full, arduous process of foreclosure.
  • Explains that a c.i. cert is required to take out mortgage loans, which is equivalent to applying for vehicle registration with the dmv.
  • Opines that requiring a mortgage-lending course and consumer intelligence certification for all consumers would have two positive effects upon the foreclosure crisis.
  • Opines that a c.i. cert will make the mortgage lending process more complex, longer, and take more patience from the consumer and the banks.
  • Explains that mandatory classes have been a tactic to ensure the safety of our society. a certification like this ties perfectly with the philosophy of the cfpa, and barack obama himself.
  • Explains that the bush administration committed $59,900,000,000 to the bailout of fannie mae and freddie mac in order to "provide needed housing reform"
  • Explains that fannie and freddie were fully absolved into the federal government, and their debt has yet to be repaid. the second part of their plan outlines a novel form of repayment to our government.
  • Explains that citigroup received 45.7% of the bank industry bailout money, and still owes $25,000,000,000. private banks like this one, along with specialized mortgage lending companies, possessed the largest amount of toxic assets and are the greatest source of increasing foreclosure rates.
  • Explains that the government's foreclosure ceiling is a government-mandated limit on foreclosure rates. if citigroup keeps its foreclosure rate below this ceiling, it will be counted toward its repayment and remove 5% of its debt per year.
  • Explains that citigroup's debt can be repaid in approximately 20 years, in addition to the interest on its remaining balance per year.
  • Explains that citigroup will not be paying the federal government exclusively through dividends, but through the value to the market. if a plan like this was instated, it would effectively end the foreclosure crisis.
  • Explains that citigroup is noted for its cooperation with consumers regarding foreclosure, making it an exception in its field. a ceiling program would increase the compatibility of banks with their customers.
  • Opines that the second plan is both probable and calculable. it renders responsibility to the consumer, banks, and the federal government, while paving a constructive path towards ending foreclosure.
  • Opines that president obama and the united states senate could evolve this two-part plan into legislation to solve the foreclosure crisis. every american citizen deserves a future that encourages smart consumerism, vertical benefits within our economic structure, and lucid loaning processes.
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