I’m a firm believer that if the homeowners had been “bailed out” or given aid in the form of debt forgiveness (even partial or a set percentage forgiven) this economic spiral would have stopped instead of gaining the momentum and tipping the collapse of the world markets. But alas, greed knows no forgiveness and so here we are.
Debt forgiveness probably sounds like the least helpful suggestion, but that along with allowing the banks to restructure, eliminate waste, etc. I believe we had an opportunity to really shine as a nation and we missed it. How? Imagine if 25% of a $100,000 debt on a property was completely forgiven. That is $25,000 of pure equity in that property, equity that could be borrowed against for repairs (thus creating jobs and stimulating the market), or used to restructure the loans in such a way to keep homeowners from losing their most prized and valuable asset and keeping the homes themselves from losing their value.
Many would argue, they can’t just erase debt like that. But I beg to differ. Credit is something formed out of thin air and is written to someone’s account as debt. They “cash out” that credit in many ways and creditors are not regulated as to how much credit is available. If they are given parameters of when to stop lending, it is an arbitrary number again pulled out of thin air by the unregulated, privately own FED who profits from all the interest anyway. That being said, yes partial debt and even full debts can be erased without any negative consequences. You do know that the dollar is just paper with nothing backing it, right?
I deeply admire Rep Marcy Kaptur (D OH) for speaking out in defense of the homeowners in foreclosure. They have been painted as the culprits of this economic turmoil, when in fact many have been nothing more than victims of falling below the bank’s “bottom line.” People say it’s just business, but I can testify first hand, that there is little to no protection in place for homeowners. I got behind enough on my payments due to a prolonged illness and inability to work that I was served papers, and even after bringing the account current, my bank still wanted to sell my house and my loan officer was rarely available and did not return phone calls. Had it not been for a fair judge hearing my case, I would be among the homeless.
Are you facing foreclosure? When I was first served papers, I was so afraid there was nothing we could do. I went online and looked at some of the modification programs that were advertised. Their fees ranged from $3000 (with $1000 upfront and the other $2000 due in 60 days) to $400. If I had that kind of money, I would not be behind on my mortgage. Even though my situation was finally worked out without the help of a modification agent or an attorney, I am still eagerly seeking social activist organizations who are in the business of helping homeowners stay in their homes. Please comment with suggestions for further research.
I said my situation worked out and it has at least at the time of this writing. The attorney for bank said they will most likely appeal the decision of the court, reject my loan payments, and continue their ambition to sell my house due to them now having his legal fees to pay. He said the bank will make me pay those thousands in legal fees, but the judge instructed me to return and petition the court if I was billed by the bank for any such fees as I had receipts and proof that I had brought the account current and was working with my loan officer. It was failure on the banks part to stop the process of foreclosure and the work of the attorney when we reached an agreement and I kept my end of the bargain. But if they come back at me, I am ready and not leaving my home without a fight. I hope you don’t give up either if you’re in similar circumstances.
