What can President Obama do to stabilize the housing nightmare the country is and has faced?
Write down mortgage debt for the millions of underwater homeowners facing foreclosure. Debt forgiveness would be highly stimulative as well as just. Reducing the capital owned by families would enable them to keep their homes, rebuilt savings and begin to act like consumers again. Banks would take a hit on their balance sheets, but those loans could never be repaid anyway.
The New Bottom Line, a national campaign of labor/liberal groups and grassroots networks like National People’s Action, estimates that writing down underwater mortgages to market value would pump $71 billion a year into the economy and create 1 million jobs. Because huge portion of failed mortgages securities known as “toxic assets” are now federally owned-purchased by housing agencies like Fannie Mae or the Federal Reserve, the White House can use it’s clout to engineer terms for a general write down. Bank regulators can lean on bankers to comply.
(reposted from The Nation)
Amerihope Alliance Legal Services sees the suffering the nation’s largest mortgage lenders are creating every day by artificially keeping housing prices at levels that benefit their own corporate interest. While we don’t have the power to make our government heed the needs of its people over that of its campaign financiers, we do everything we can for our clients that are losing their homes due to the financial crisis.is.
If negative equity, rising interest rates, or unforeseeable family hardships are putting you at risk of foreclosure, then get a free consultation today from Amerihope Alliance Legal Services to see if we can help you.