Economy Alarm: More Families Losing their Homes as Dems Push Job-Killing Policies
Housing Crisis Worsens Despite Dems’ Promises to Turn Economy Around
President Obama Promised the Stimulus Would Address the Housing and Unemployment Crisis
“In the end, all of us are paying a price for this home mortgage crisis. And all of us will pay an even steeper price if we allow this crisis to continue to deepen — a crisis which is unraveling home ownership, the middle class, and the American Dream itself. But if we act boldly and swiftly to arrest this downward spiral, then every American will benefit…A lost home often begins with a lost job.
“So yesterday,…I signed into law the American Recovery and Reinvestment Act…The act will create or save 3.5 million jobs over the next two years…doing the work America needs done. And we’re also going to work to stabilize, repair and reform our financial system to get credit flowing again to families and businesses. (“Remarks by the President On the Home Mortgage Crisis,” whitehouse.gov, 2/18/2009)
Credibility Crash: Foreclosures and Unemployment Surge As the Stimulus Fails to Revive a Struggling Economy
The number of U.S. homes lost to foreclosure surged in July, another sign lenders are moving quicker to take back properties from homeowners behind in payments.
Lenders repossessed 92,858 properties last month, up 9 percent from June and an increase of 6 percent from July 2009, foreclosure listing firm RealtyTrac Inc. said Thursday.
Banks have stepped up repossessions this year to clear out the backlog of bad loans. July makes the eighth month in a row that the pace of homes lost to foreclosure has increased on an annual basis.
Meanwhile, homeowners who are falling behind on their payments are being allowed to stay in their homes longer because lenders are reluctant to add to the glut of foreclosed homes on the market.
The number of properties receiving an initial default notice – the first step in the foreclosure process – rose 1 percent last month from June, but tumbled 28 percent versus July last year, RealtyTrac said.
Initial defaults have fallen on an annual basis the past six months.
The latest data reflect a foreclosure crisis that continues to drag on as many homeowners struggle to make their monthly payments amid high unemployment, slow job growth and an uneven rebound in home prices.
Economic woes, such as unemployment or reduced income, are now the main catalysts for foreclosures. Initially, lax lending standards were the culprit, but homeowners with good credit who took out conventional, fixed-rate loans are now the fastest growing group of foreclosures.
Lenders are offering a variety of programs to help homeowners modify their loans, but their success rates vary. Hundreds of thousands of homeowners can’t qualify or fall back into default.
The Obama administration has rolled out numerous attempts to tackle the foreclosure crisis but has made only a small dent in the problem. More than 40 percent, or about 530,000 homeowners, have fallen out of the administration’s main effort to assist those facing foreclosure. (Alex Viega, “Homes lost to foreclosure up 6 pct from last year,” Associated Press, 8/12/2010)
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