Is Our Government Going to Solve Foreclosures?

Published by julia | Filed under Buyer / Seller Tips, Miscellaneous, Real Estate, Shout Outs

As prices in many markets continue rising and going flat nationwide, so will foreclosures. The problem is painful for some who are affected such as new century financial corporation or people whose reside in foreclosed homes. Some critics think the economy will end up being bankrupt because of so many foreclosures. Others believe it is a way to end the booming real estate business to take care of the economic cycle of a free-market. Whoever is right, only time will tell, however, seeing politicians trying to fix this issue is very shocking. They have come up with a number of solutions explained below.

Allocation of Funds

Tax the wealthy, provide to those deprived. To help save peoples houses, the national government wants to sponsor programs. The senate’s new bill proposes funding people not able to pay loans. This confuses taxpayers, as they do not understand why the taxpayer’s money should be given to people who in the first place took loans they could not afford.

Regulate Investor’s Foreclosure

New legislation limiting options for foreclosure sellers is not the only answer when protecting property holders from unethical investors. A better option is to enforce the existing laws on consumer protection under current criminal laws. However, allowing investors to use up inventory in a free market is the best answer. This will tie up investors full of complicated regulations thus discouraging transactions and result to more property in lender accounts. These leads to lowers prices which will affect the sell of property market.

Prevent the Foreclosure Procedure

Homeowners in Massachusetts can file their grievances to the office as it passed an authority over any lender foreclosure to delay for two months. If this deed is based on complaint from consumers, then does this complaint deserve government involvement in stopping lenders from collecting the debt? Any property owner can delay or stop foreclosure using courts order if they claim violation of rights.

Stop Lending Money

Many people fell into the loan trap, when the lenders decided to become sloppy in issuing mortgage and as a result, many homeowners lost their properties and had difficulties in paying back the loan. This is because at that time they did not understand the risks in taking loans they were not able to pay. In other words, they were taking a gamble. Should lenders offering risky loans be stopped by the government? The answer is “NO”, this is because they will suffer financially as the market takes care of itself.

Enforce Existing Laws

The government should fund the enforcement instead of eliminating the business. Adequate laws exist that that offer the federal and state prosecutors enough room to prosecute unlawful operators. The government can control and make laws about it but only free market can work out the foreclosure issue. When demand is higher than supply, prices in the market will rise and people will be able to sell their home, as equity will be enough. All people should be responsible when dealing with their finances. Negligence and naiveness may lead to lose of properties.