The continuing home foreclosure crisis continues to reverberate throughout the housing market and other sectors of the economy. But the real tragedy is what foreclosure—or even the threat of default—does to families and individuals who face this kind of financial upheaval. And, it’s happening everywhere. While foreclosure rates are highest in “rustbelt” states like Michigan and Ohio, no state or region is immune.
High foreclosures rates are largely the result of lenders offering mortgage loans below the prime lending rate. These “sub-prime” loans are most often provided to those with poor credit or buyers who need adjustable-rate loans to purchase homes. Mortgage defaults also can be the unfortunate result of a lost job or even a serious injury or long-term sickness that prevents breadwinners from working.
Foreclosures can also be initiated by the associations, but this is rare and most often the result of an owner refusing to pay association assessments over a period of time.
We hope none of our neighbors ever face a financial crisis leading to foreclosure, but that is wishful thinking. It can and does happen. If you or someone you know faces this kind of personal crisis, advice and information are available.
For information on foreclosure and mortgage lending, check out these websites:
- Americans for Fairness in Lending: www.affil.org
- Consumer Federation of America: www.consumerfed.org
- Center for Responsible Lending: www.responsiblelending.org
- FTC Fact Sheet, “Mortgage Payments Sending You Reeling? Here’s What to Do”: http://consumer.ftc.gov/articles/0187-when-paying-mortgage-struggle
- Neighbor Works America’s Center for foreclosure Solutions: http://www.neighborworks.org/Homes-Finances/Foreclosure