“How to Stop the Foreclosure Crisis”
I was very excited to learn that a scholarship was available that focused strictly on ending the foreclosure crisis in this country. Coming from a real estate lending background affords me the kind of first-hand experience necessary in order to invent a process that will work in a real world setting. I am no longer employed in the field due to the banking crisis. Our current economic problems are also the main reason why I am back in school and trying to complete my Juris Doctorate degree. Although I no longer work in the financial industry, I do have many ideas that when properly formatted into lending policies would carry the force and effect necessary to end the foreclosure crisis. In addition to fixing an overwhelming amount of foreclosures, these policies will also help to rebuild our consumer base which I consider to be the linchpin to fixing our overall economic crisis as well.
My background and work experience in the mortgage lending industry began in 2002 when I took a job as a wholesale loan officer for a small family owned brokerage firm. The word wholesale basically means that the company I worked for had access to an infinite number of mortgage related products from any number of different financial institutions. For a fee, usually a percentage of the borrowed amount, a consumer had access to lower interest rates than if they had visited a larger local bank like WellsFargo or Bank of America. What I learned working for this company is that anything can purchased for the right price. For example, if a borrower could not or did not want to prove his/her income they would pay a higher fee and “state” their income on the file without having to send any documents that verified the “s...
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...true way they can save themselves in the long run. First, the money being used is ours anyway. TARP money is tax payer money and it should be re-invested in us. Second, they are 90% responsible for the position they currently find themselves in and should have some skin in the game. Last, I go back to my earlier statement about consumer base. This is the only way to affect the amount of people necessary to save the consumer base. Without them, our banking system is setting itself up for a secondary collapse. Banks will have to start investing in the future again and right now that future is us.
Works Cited
Scott, Robert E. “FED Up.” Economic Policy Institute (2001):
< http://www.epi.org/publications/entry/issuebriefs_ib148/>.
“Government Acts and Regulation Definitions” Google search:
< http://en.wikipedia.org/wiki/Gramm%E2%80%93Leach%E2%80%93Bliley_Act>.
subprime mortgage crisis The argument over who is at fault for the housing market collapse has been a heated issue amongst government, politicians, banking institutions, and mortgage lenders. The subprime mortgage crisis is an ongoing financial issue and real estate nightmare for the United States economy. A dramatic increase in mortgage delinquencies and foreclosures has caused a significant adverse effect on banking institutions and financial markets. Due to this mortgage crisis, the housing market
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
In order to accurately solve the problem of the foreclosure crisis the nation is currently in, one must look at the cause of the issue. To determine the cause, the history of foreclosures has to be looked at. The questions, “How long have foreclosures been around? In the past what was the cause of foreclosures? How was the problem fixed before? What are the similarities between now and then?” all need to be answered. Foreclosures have been around since the first public banking system was brought
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
Including a description of distressed real estate and foreclosure in addition to how utility can play a role in the decision-making process. Distressed Real Estate and Foreclosure Distressed Purchase Collateral for the defaulted loan. Distressed real estate involves making a distressed purchase. According to Financial Crisis (2011), “[A] distressed purchase is whereby the property owners are usually in a foreclosure/short sale situation.” Foreclosure applies to a residential real estate loan in which
America survive? In Richard Florida’s article “How the Crash Will Reshape America”, he explains the different approaches America can be transformed to help them out of the economic crisis. Although Florida presented different solutions to help get through the times of the recession, the housing market whether we are considering new construction or renovations on existing homes, will lead a path to aid us in lifting the release of the perils of a recession. “How the Crash Will Reshape America” explored
Before we begin to implement any changes that will reverse and/or fix the foreclosure crisis, we need to understand the causes of the crisis. There are direct causes and correlative causes. The most direct causes have been discussed ad nauseum in the media. Some of these direct causes include; high (property) taxes, loss of jobs, resetting adjustable Rate mortgages, loss of credit rating (due to other causes that result in the inability of the borrower to pay bills on time or at all), medical bills
a lot can go wrong as it did in 2008. Many institutions can be held accountable for the housing crisis in 2008, whether it be the banks for lending risky subprime loans, borrowers for risking their house on future assumptions like a higher pay right or their home appreciation, or investors buying mortgaged backed securities without researching what exactly comprised these securities. The housing crisis shows that everyone takes a risk when it comes to investing and everyone may pay the consequences
across the country, scrutinizing how reality and spin often collided. As an illustration, Michael Grabell speaks about signs of recession in March 2009; and how the recession consumed many states across the United States in the fall of 2008. Employment rates were decreasing, Unemployment rates were off the charts and there were many house foreclosures. Furthermore, in Krugman’s Economics for AP* it goes more into depth about the signs of recessions and house foreclosures which can be seen in Module 2
that range from least risky to most risky (“Ratings Definitions,” 2014). Prior to late 2007, Moody’s was a highly trusted rating company. In December 2007, the U.S. entered the third longest recession in its history. According to Britannica, the crisis in the American housing market eventually caused the entire economy to collapse. Mortgage dealers issued mortgages to unqualified families with unfavorable terms (Havermann, n.d.). Companies like Moody’s came into the picture when it was time to
done with the judges who would review parole requests. When they were ego-depleted, the “tired and hungry judges [would] tend to fall back on the easier default position of denying requests for parole” (Kahneman 44). This portrays how lazy our system 2 really is and how ego-depletion leads to a lack of self-control, not allowing us to make good judgments by using our rational minds. Since we lack discipline to control ourselves, we tend to make impulsive decisions that can be risky. These impulsive
certain conditions. People that are in temporary housing are considered homeless. Natural disasters can cause someone to become homeless, such as Hurricane Katrina. Many people today are homeless because they have lost their homes to foreclosure because of the job crisis. According to data taken in 1988 it was estimated that approximately 500,000 to 600,000 people were homeless (par. 6). Homeless people are viewed as filthy, dirty people with unwashed clothes and living in cardboard boxes in alley ways
philanthropists. But obviously the struggling residents of Freeport have found innovative ways to survive Grand Bahama's economic crisis. The residents have broken no laws, and are law-abiding citizens who are trying to keep swimming and not drown in the terrible economy. “ I remember hearing PLP candidates complaining about many Grand Bahamian families losing their homes to foreclosure. With no job prospects and no money in the bank to get an apartment, these people have resorted to sleeping on the various
Craigslist to arrest a handful of people for stripping homes and trying to sell the goods, charging them with felonies under a state fraud statute" (Rudolf). Or maybe it is legally unknown, as for houses "in Florida, another state swamped by foreclosures. Several prosecutors and police agencies there said that unless laws were modified, such behavior would have to be sorted out between borrower and lender in civil court"
The phrase “History repeats itself” is a commonly used paradigm when it comes to events that happen in a repetitive notion. The recession that has recently been witnessed by the millions is a great example of history repeating itself. How did it happen, did we know it was going to happen, and was there anything that could have been done to prevent it? There are a multitude of questions that could be asked, with the most important of them all, will it happen again? In just the past two hundred