House Subcommittee To Discuss Foreclosures
On Tuesday at 2 pm, the House Judiciary Committee’s subcommittee on commercial and administrative law will meet to discuss measures to stall foreclosures. Wall Street has been in turmoil and there is mayhem on Main Street. The scheduled speakers are Jack Kemp (secretary of HUD under President George H.W. Bush), Wade Henderson (Civil Rights leader), David G. Kittle (representative of Mortgage Bankers Association), economist Mark Zandi, Faith Schwartz (spokesperson of Hope Now Alliance) and John Dodds (director – Philadelphia Unemployment Project).
It comes against the background of increased concern about the state of the economy. The foreclosure crisis has worsened touching the 2 million mark and that is not the worst. With more mortgages ready to rise more householders are under threat of foreclosures and eventual eviction.
Hope Now is an amalgam of lenders, investors as well as non-profit counseling groups set up by the Bush administration in last October. It was an attempt to address the problem that lead to rumblings in Wall Street and stock markets across the world. Bush put a five year freeze on initial interest but this will help only 3% of sub-prime loans – 118,200 house owners. It will hardly scratch the surface of the problem. The plan was criticized for ignoring those borrowers who would opt for refinancing before the rates reset for higher notches.
The foreclosure game is not confined to the boundaries of the court with the lenders on one side and the borrowers on the other with the latter taking a beating. The ball has started rolling helter-skelter to all sides and in the foray not leaving the lenders untouched. There are so many houses tumbling down that the banks and lenders are in a tizzy. They do not know what to do with the weight of bricks and mortar that does not fetch money. Rather they cost money, as foreclosure requires the spending of time and money. With the real estate markets down the houses are not selling. There are more houses than buyers. Moreover with mortgage groups cautious about lending money is available. Abandoned houses are vitiating the crime scene in the entire neighborhoods and disease is spreading from overgrown gardens and stagnant pools. Taxes are not coming in, as foreclosed units are not liable to pay it until a buyer comes and clears dues. Without transfer of property the government revenue kitty level is at an all time low.
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