Because homeownership is central to a family’s security, well-being, and long-term asset accumulation, the foreclosure crisis must be attacked aggressively by Federal and state governments. Critics of stimulus spending argue that the worst of this crisis is over, but many trustworthy indicators suggest that foreclosure rates will not return to pre-crisis levels for several years. In order to slow foreclosure rates and begin to repair affected communities, steps must be taken both to prevent existing homeowners from facing foreclosure and to prevent lenders from issuing mortgages that are beyond the ability of the borrower to repay. Although the latter step of increasing regulations regarding predatory lending in the future is beyond the scope of this proposal, it is absolutely essential. Without changes in mortgage lending, any positive steps taken to protect current homeowners will be negated.
The advice implies that there is certain safe limit for the use of debt beyond which debt should not be used. The point also indicates optim... ... middle of paper ... ...oss of financially flexibility: Retaining the financial flexibility is a strong concern of the creditors. The creditors are aware that a choice made today can limit their possibilities for another choice in the future (Vernimmen, 2005). Thus the debt taken today adds pressure on future investments. In future suppose a major investment is required and the borrowing capacity has been used up, then there would be a requirement of generating fresh equity.
This means that if a treatment has more negative outcomes compared to an alternative treatment then you must obtain informed consent. “For ex... ... middle of paper ... ... be in the patient’s best interest and getting the best results for the trial. When the treatment can be found inside and outside of the trial, then no consent is needed. Since they cannot anticipate how the drug will react in the trial and preform unsatisfactory results, they still need the patient consent. A treatment cannot have more risks than an alternative.
Housing is also an important channel to facilitate access to credit for liquidity constrained households. Many households do not hold significant non-housing assets that can be used as collateral, so extreme volatility in house prices may adversely affect certain households access to credit. There are also increased risks to the financial sector from falling house prices. Residential mortgage lending is a high proportion of bank assets, and sharp falls in house prices can result in negative equity loans. High loan to value ratios, in particular negative equity loans, are positively correlated with the probability of default, which can put stress on the financial position of the bank, leading to a tightening in lending standards, caution in the financial markets and possibly unanticipated adjustments to interest rates, exchanges rates and monetary policy intervention.
Foreclosure Strategy To solve the foreclosure crisis we must take a multi-pronged approach that tackles the issues making the situation worse and that caused the problems in the first place. Our goal is to do this in an efficient and time conscious manner. Any solution is going to have its positive and negative aspects but we must try to maximize the former and minimize the latter. The biggest problem is that we had and have an overinvestment in real estate that led to an overproduction in housing. In other words we have too much supply.
As a result lending institutions with less stringent requirements will make loans to communities that are less desirable then others and often place high demands on the person or persons obtaining the loans; this is called predatory lending. There are many laws on the books which prevent such activities; however the laws are not enforced by law enforcement agencies. We must therefore insist that the government enforce all laws, especially those that take unfair advantages of those seeking the American dream of being a home owner. Rules requiring individuals to take additional insurance out on their property, if they do not have at least twenty (20) percent equity in their homes, should be eliminated. This additional insurance is called PMI.
Racism, viewed from a structuralist explanation, sees poor health situated outside individual control, placing greater stress on social and cultural factors (Julian, 2009). The Weberian and feminist perspective is a particular view that stems from this approach. It is a complex interrelationship between class and ethnicity, specifically affecting the experience of racism among minority groups (Julian, 2009). This gives reason that agency, the ability to have control over your life, is a contributing factor towards reports of racial discrimination as it is not controlled by the individual (Germov, 2009). An ethnic identity is considered... ... middle of paper ... ...e treatment strategies (Stronks et al., 2013).
However these current plans limited to those nationalized entities fails in comparison to the overwhelming number of foreclose properties on the market and those that the banks have yet to release. The housing industry need some stability for future assurance that once this crisis is past it is improbable for another one to occur. First and foremost, there needs to be standards to homeownership approval. While it is true that some marginalized communities do not have the same purchasing powers as others, they are still able to meet minimum standards. Predatory lending was a primary factor in the real estate bubble-lenders underwriting homes to people who could not afford them or maintain them.
It must: • Result in modifications that create affordable monthly payments • Deal with negative equity • Address junior mortgages • Overcome obstacles in existing pooling and servicing agreements that may prevent modifications • Counteract mortgage servicer incentives not to engage in modifications • Provide adequate outreach to homeowners • Be quickly scalable to deal with millions of mortgages • Encourage widespread participation by... ... middle of paper ... ...olve other pressing problems like the impending water crisis by building relevant items like giant reservoirs or nationwide pipelines. Overall, solving a problem as complex as the foreclosure crisis is not a simple task, but important progress can be made if wise decisions are implemented. However, there is always a danger inherent in all change which is that the effects of the change might be more disastrous than the initial problem. Thus, as is accomplished in this solution, any changes to be made should be free from detrimental side effects or reduced freedoms. With the simple steps of changing the rules for conforming loans, administering a competency exam for borrowers, and spurring job growth through high profile public works projects the foreclosure crisis can be solved and America will be left with a future that everyone can be proud to leave to posterity.
However, are all those experiences really needed to be fully happy in life? Being happy is priceless but houses are not free. Buying a home is such a grand expense in itself, the mortgage, interest, and what seems like never ending monthly payments. Millennials are questioning if stressing over the cost is really worth the house. Houses also do not come with furniture.