Foreclosure Final.doc - Foreclosure Grenawalt Chod...

This preview shows page 1 - 3 out of 7 pages.

ForeclosureGrenawaltChod GrenawaltGilroyLaw of Real Property and Real Estate TransactionsJuly 10, yTake Me, I’m Yours: Foreclosure in the United StatesForeclosures in the United States have reached a devastating high in the recent market. Starting in the early 2000’s banking institutions started participating in programs to help good people achieve the American dream of homeownership and financial independence. New mortgage programs and lower credit minimums were established to help good people purchase homes, which are crucial to a stable family life. The lenders that were trying to help the country’smasses attain the American dream of homeownership have not been treated fairly, a large portionof the mortgages have been foreclosed on. The American public that depended on the generosity of the lenders to achieve their dreams simply stopped paying back the money they borrowed.The official housing market crash was 206-2008. The causes of the crash are still being debated, there are however a few things that we can say for certain. The lenders’ assisting the American public to obtain loans contributed greatly in helping many realize the American dream.Many Americans unfortunately took advantage of the banks lowered loan requirements and did not maintain their obligations. Supply and demand is consumer driven and because of the boom of mortgage requests the cost of real estate rose accordingly. The large influx of house purchases and at a cost reflective of the demand caused a large gap of value when the market slowed down. When the American housing demand slowed the inventory of houses did not decrease, and the value of all real-estate dropped. Consumer spending has long been used as a tool to blame the slow market recovery. Forbes has published many articles in the past few years that pointed to the increase in consumer spending and home ownership. The growth of the market is slow after a devastating crash of the tightening of the leading market. Currently in 2013, we are at the same point financially as we were in the late 1980’s and 1990’s. Consumer education has played a role in assisting the consumer, providing knowledge of the market and its trends. The average consumer has been advised to budget for the worst and hope for the best.
ForeclosureGrenawaltA new law that is planned to go into effect later in 2013 is the ability-to-repay rule. Underthis new law the lenders are required to dig into the personal finances of any potential client and make an assessment of their ability to repay. This new law benefits the lender no more than the consumer. The ability to achieve the American dream has been limited to those only with the bestof finances, whereas before the lenders were able to help out the masses by allowing those without perfect finances to attain home ownership.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture