Positive Results of Foreclosure Crisis

The foreclosure crisis has produced a dilemma for not only homeowners who are losing their homes, but for entire neighborhoods. Our era of easy credit brought people into the market with a dream of owning their own home, but uninformed as to the ramifications it involved. However, now that it has hit the crisis stage, the adoption of new regulations in several states will protect future home buyers.

The under-regulated marketing for subprime loans with easy credit allowed many people into the housing market that should have never been there. The mortgage broker’s promise of the golden egg duped the hopeful public as a whole. The foreclosure crisis is not only affecting the devastated homeowners, but also the communities where unkempt homes and yards are decreasing the value of the homes around them.

The good news is that the foreclosure crisis has stimulated lawmakers in several states to establish more regulation to protect home buyers. In New York, the mortgage lender must give a 90 day written warning before the start foreclosure proceedings. In addition, the court is required to get involved and hold a settlement conference between the borrower and the sub-prime lender. Las Vegas is reportedly using the federally funded program to increase affordable housing while rejuvenate residential areas. In Maryland, lawmakers are making every effort to pass foreclosure protection laws properly to prevent the corrupt practices that have caused the mortgage crisis in the first place.

Even though this legislation cannot help those buyers who deliberately bought more than they could afford, it will prevent the lenders from repeating to same infractions by holding them responsible for their corrupt practices.