GMAC had its beginning in 1919, when the General Motors Automobile Corporation decided to begin offering in-house financing to prospective purchasers of its cars. Christening the new corporation General Motors Acceptance Corporation, GMAC began processing auto loans and establishing itself as a premium lender. Over the past 90 years, GMAC has gone through many evolutions and expansions. It began offering home mortgages in 1985, and has since added private banking, corporate financing, insurance, and other items to its portfolio of services. In 2008, the company was granted permission to form a private bank holding company. At this time, GMAC Financial is the fourth-largest financial holding company in the United States, behind Bank of America, Wells Fargo, and JP Morgan Chase Bank. As of the end of 2009, the company held more than $225 billion in mortgage portfolio assets alone.

GMAC began to encounter problems in 2006, when the economy began a downturn that is still being dealt with today. The resetting of adjustable rate sub-prime mortgages (ARMs) to much higher interest rates, causing mortgage payments to skyrocket, send a wave of panic through the country as people were unable to afford their payments. Property values bottomed out in 2007, decreasing the value of properties while the loan became more vulnerable to foreclosure. GMAC foreclosures shot through the roof, with the bank hastily foreclosing on properties as the loans went into default. GMAC was not alone in this, as all the other large lenders also were hit the same by the economic crisis.

In 2009, GMAC Mortgage was purchased by Ally Bank, the private banking arm of GMAC Financial. This name change was directly attributable to the lamentable sub-prime mortgage lending crisis, which was one of the main causes of the ARM resetting. GMAC Mortgage had been (like other lenders) too quick in approving prospective homebuyers for mortgage loans back in the late 1990s and early 2000s, allowing these “sub-prime” borrowers to engage in a loan but at an adjustable interest rate. The inability of these homebuyers to make their payments led to the crash of foreclosures, a domino effect that devastated the entire economy. Once the wave of GMAC foreclosures were investigated beginning in the beginning of 2009 (all four Big Four banks were investigated, as well as other smaller institutions), consumers found the brand name unpalatable. Because Ally Bank had been operating in the black and with a good reputation, it was felt that by rebranding GMAC as Ally it would help alleviate some of the distrust caused by GMACs previous history. Only time will tell if this succeeds.

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The United States’ housing sector has been slowly recovering from the huge debacle during the recession but the growth has been much slower due to controversies surrounding foreclosures in the country. In late 2010, it has been found out that lenders and banks are not properly reviewing consumers’ mortgages. The robo-sign case has been first exposed in 1999 by mortgage fraud activists, where they referred the practice as robotic process of approving mortgage documents related to foreclosures. The robo-signers are persons who sign notary affidavits even without sufficient facts to support the foreclosure. Huge institutions like JP Morgan Chase, GMAC and Bank of America suspended their foreclosures across the country to investigate employees who are involved in the scandal.

The foreclosure statistics in the last quarter of 2010 showed that there had been a significant increase in foreclosed properties which alarmed the government and forced the Congress to amend the law for courts to accept electronic notarizations and notarizations outside of the state. This is to control the number of foreclosures that the bank could handle and at the same time carefully review all documents before the bank possesses the properties. Banks suspended foreclosures after the controversy has been exposed because this would leave negative effects in their institution and cripple the financial sector as well. Owning a lot of bad mortgages through foreclosures is a very costly process and with improper foreclosures, banks risk themselves in millions of dollars in debt. The worst case scenario though is that multiple banks would sell one foreclosed home because of banks’ inability to track which homes they foreclosed.

GSEs also took measures and asked banks and lenders to review all unjust foreclosures. They sent detailed instructions before they continue dealing with them. This is to regulate all Freddie Mac and Fannie Mae foreclosures and to ensure that the interest of consumers is still protected. After the investigations, banks fired all employees who were proven to be robo-signers. On the other hand, attorney generals in several states filed lawsuits seeking fines from banks for customer restitution. This could potentially cost lenders a lot.

The robo-sign controversy may have slowed down the recovery from recession but having it exposed early is also beneficial that it avoided the crippling of the financial sector before it’s too late. Further widespread of robo-signing could lead another economic downturn which would make recovery harder for the American people.

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The housing market is improving. The trend is not very dramatic. This was revealed by Kenneth Rosen, a Haas School of Business professor. However, the unemployment rate of the state is still high at 12.4 per cent. Even the demand for housing is still very weak. However, there will be trouble soon. Many mortgages that are of adjustable rate will be reset and that too, at higher rates in the future. This was revealed by Rick Sharga, a senior official of RealtyTrac. If borrowers are unable to make the escalated payments, foreclosures would increase again.

Sharga said, “You have the three-headed monster of high unemployment, a weak economy and problem loans.” He said that foreclosures would surpass that of last year and even that of ’09, which was considered to be the peak year. Take for instance, Guy Vernikovsky. There has been a foreclosure filing on his Torrance home. He has tried to adjust his loans many times and has applied for low interest rates.

Thirty two year old Vernikovsky said he is currently without a job. However, he tried his level best to be current on two mortgages. Subsequently, he has buried himself in debt of credit card. However, now he has moved with parents and has got himself a new job. He said that he would now be able to make the loan payment if banks reduce his loan interest rates. Vernikovsky said, “I applied two or three different times and they would not modify my loans. I wasn’t looking to turn a fast buck on a real estate market that was hot at the time. I was really looking to own that home for the next 20 to 30 years.”

It may be pointed out here that above a million homes in California are facing some kind of foreclosure activity. This includes bank takeovers and default notices. Of these filings, 173,175 properties have been reclaimed by banks once again.

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The economy continues to be weakly trying to stand up. An increasing number in Michigan are walking away from foreclosed houses that have gone underwater. The value of the property has become less than the loan amount due. From 2005 to 2008 the numbers of such people have tripled from 5,100 to 17,250 as per the findings of Experian-Oliver Wyman.

Mark Zandi of Moody’s Economy said that he apprehends the situation to worsen in 2010 and continue on to 2011. Speaking to the Detroit Free Press he said, “As people struggle to make ends meet, they will say, this just doesn’t make sense.”
Underwater mortgages are fueling this trend of people walking away from their properties. Michigan stands fourth in the country as regards underwater mortgages. 38.5% of the house owners counting to 532,774 owe more than the worthy of their houses.

For those who want to continue staying in their houses despite this, the situation does not pose a problem. But it is difficult for those who have to move out because of job constraints or who have lost their jobs and want to cut down expenses. Those walking away usually do so after having failed to negotiate a loan modification or a short sale.

Attorney John E. Jacobs of Southfield focuses on real estate. He said that the societal stigma attached to walking away from loan commitments is fast fading. He said, “When things are that bad, your moral compass, and the obligation to make payments that most people feel, has to give.”

One of those who walked away is Sondara Malone. She is in her mid thirties. In 2005 she purchased a house in Eastpointe with an ARM loan. But the monthly payment of $1,200 together with heating bills and payment for a costly SUV became too costly for her. Soon debts began to bury her. The final blow was when the real estate market collapsed and the value of her house fell. She soon went underwater with her loan on the house calculating to $116,000 on a house that was worth $99,000 in 2007. She tried to negotiate with her bank to either lower payments or to sell it but when nothing worked she took a condo on rent and just walked away. Social worker Malone said, “I didn’t know what else to do. I’m embarrassed.”

Meanwhile strategic defaults are increasing together with more foreclosures.

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Shelby County is poised to file lawsuits against banks for their dubious foreclosure activities. At stake will be millions of dollars. It is an effort on the part of the administration to plug the flood of foreclosures.

The County Commission voted unanimously (8/0) during the second week of May 2009 to authorize the county to go ahead with legal procedures. Memphis City might not participate. In December 2008 the measure had been passed by preliminary votes. Again it was repeated this month.

In December the city authorities of Memphis had given support saying that it would add $125,000 to the legal fees over and above that being paid for the county. The total amount of $250,000 would be a down payment for the jumbo sized legal expenses. The government nurses the hope that the rest of the money would come from a law firm located outside the state who would be allowed to take a percentage of a whopping settlement – if and when that came about.

The officials from the city and the county said that the banks had mainly focused on neighbourhoods occupied by the Blacks for their predatory lending.

Many in the county complain that Memphis has been dragging its fee after the resolution passed in December. But Myron Lowery, the chairperson of the City Council said that as far he was concerned the game was on. Elbert Jefferson the attorney of the city was not available for comment.

The resolution passed by the county said that if Memphis city did not act by 10th June, the county would go ahead on its own with the assistance of outside legal help. Brian Kuhn the attorney for the county said that in all probability they would be working with Beasley Allen a law firm based in Montgomery. They would also be assisted by Webb Brewer, of Memphis Area Legal Services – a non-profit legal body committed to helping the needy. Brewer explained that in this case he would be acting in a separate position from that he held in the non-profit body.

The finances of the county had suffered because of foreclosures leading to a fall in tax collections.

No approximate estimate could be guessed of the dollars that could be won. Kuhn said, “There’s a big figure out there somewhere. It could be in the millions of dollars in terms of the loss of the tax rate.” He added however that maybe nothing would be won!

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NBC News reported that one bright spot in the housing crisis actually favors first time homebuyers. Houses that were out of reach for a lot of people or people looking to buy in better neighborhoods for a long time found it unobtainable. The recent trouble in the real estate market has made it easier for this segment of the country to actually get into the homes that they are after because the prices are now where they can afford to get them. One person in Phoenix could not afford owning a home a year ago. Just recently he ended up purchasing a home that was valued at $220,000 last year and the price he paid this year was only $82,000. In fact the purchases made so far this year show that over 53 per cent of the purchases were to first time home purchasers.

In Washington, the Federal Housing Authority is scheduled to ask Congress for nearly $800 million dollars to help prop up the housing market with mortgage programs specifically for senior citizens. It seems that the FHA is concerned about reverse mortgages since the cost of housing is falling. A house that a senior may have had insured for $200,000 may well end up selling for less after they die than the reverse mortgage actually owes on it and that could be a real concern in the market as it stands today.

Out of Florida more people are being forced out of their homes in Pinellas Park than ever before. According to the St. Petersburg Times the local police begin making the rounds and trying to set up shelter for the homeless as early as 5 AM each day. At seven o’clock they know how many beds are going to be available at the local shelters and they begin trying to make sure as many are accommodated as they can. This is as much to get the people off the street for safety as it is for humanitarian reasons.

The Columbus Dispatch reports that three people were indicted in a tax scheme, which involved high value homes. The scheme involved tax evasion and kickbacks for the builder and several other things that the FBI is documenting and re-creating through the reconstruction of shredded documents. The overall valuation of the fraud is in the multi-million dollar level and may well climb higher as the FBI and IRS dig farther into the case. One home alone was 28,500 square feet, nine bedrooms and nine baths. So we are not talking small humble cottages.

The Fox News Network in the twin cities of Minneapolis St. Paul in Minnesota report on a program whereby Dakota County is offering a foreclosure workshop to help people who are worried about being foreclosed upon by giving them free advice that tells them of plans and available options and answers questions that they might have about impending foreclosures.

This is a positive story. It tells you how to deal with it. The fact that there are three steps to dealing with foreclosure and they are not to blame your self, look over all the options and try not to worry. The article explains how you can do this and finally that you need to get as much information as you can. Knowledge is the one thing that can make it all easier to deal with. The whole country is in this mess and being stressed will only make it worse.

The Pittsburgh Gazette brought us a piece about HGTV and the show that might literally save people’s homes. This particular article focuses on a California home where the prize money for winning is $250,000. The issue here is that the particular home in the competition for the TV show can be saved from the foreclosure if they win. If they are not the winners, then the house that they are living in may fall into foreclosure and the woman that lives there and her two teenage children might end up on the streets. The market is putting an interesting spin on this particular challenge without actually trying.

This one proves that no one is beyond the touch of the current market problems. Victoria Gotti, daughter of the famous mafia boss John Gotti is losing her 4.2 million dollar Long Island mansion to the foreclosure system. It seems that she is $650,000 in arrears and has not made a mortgage payment since September of 2006. The Daily News reports that JP Morgan Chase is foreclosing on the mansion, which was featured heavily in the reality TV show, “Growing Up Gotti”.

Fox ten brings us the story in Alabama where the state bar and the legal services department there have joined forces to try and help people in that state be able to stay in the home that they own and to help stay off the foreclosures of them. This is a plan that is of no cost and should help people stay in the homes they own and hopefully will lower the burden on the legal and foreclosure system in the state of Alabama.

NBC Channel 4 brings us a story out of Central Ohio where lawmakers are trying to pass a six-month moratorium on home foreclosures and would give the courts the next three years to modify the mortgage agreements. It also will allow the homeowners to stay in the home after it is foreclosed and would set up a trust fund to help them financially. If it passes both the house and the senate of the state of Ohio it will bring much needed relief to the people of that state.

The Miami Herald says that foreclosures there continue to soar and between March and April they increased as much as 124 per cent in Broward County. The steep increase in percentages is largely due, according to the articles sources, to the speed with which the lenders are foreclosing on the properties there. It appears that the banks have begun making quick decisions about whom they are and who they are not going to help.

Finally this week, from the Associated Press – the Obama administration has announced that they are going to expand the mortgage aid program to help the American people out during this crisis. The new things include new ways to help the homeowners by letting them sell the home for less than it is worth, which is known as a short sale or give it back without repercussion which is a deed in lieu of foreclosure. The official announcement is forth coming but it all looks promising.

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Full Text of President Obama’s Speech – February 18, 2009 – I’m here today to talk about a crisis unlike any we’ve ever known – but one that you know very well here in Mesa, and throughout the Valley. In Phoenix and its surrounding suburbs, the American Dream is being tested by a home mortgage crisis that not only threatens the stability of our economy but also the stability of families and neighborhoods. It is a crisis that strikes at the heart of the middle class: the homes in which we invest our savings, build our lives, raise our families, and plant roots in our communities.

So many Americans have shared with me their personal experiences of this crisis. Many have written letters or emails or shared their stories with me at rallies and along rope lines. Their hardship and heartbreak are a reminder that while this crisis is vast, it begins just one house – and one family – at a time.

It begins with a young family – maybe in Mesa, or Glendale, or Tempe – or just as likely in suburban Las Vegas, Cleveland, or Miami. They save up. They search. They choose a home that feels like the perfect place to start a life. They secure a fixed-rate mortgage at a reasonable rate, make a down payment, and make their mortgage payments each month. They are as responsible as anyone could ask them to be.

But then they learn that acting responsibly often isn’t enough to escape this crisis. Perhaps someone loses a job in the latest round of layoffs, one of more than three and a half million jobs lost since this recession began – or maybe a child gets sick, or a spouse has his or her hours cut.

In the past, if you found yourself in a situation like this, you could have sold your home and bought a smaller one with more affordable payments. Or you could have refinanced your home at a lower rate. But today, home values have fallen so sharply that even if you made a large down payment, the current value of your mortgage may still be higher than the current value of your house. So no bank will return your calls, and no sale will return your investment.

You can’t afford to leave and you can’t afford to stay. So you cut back on luxuries. Then you cut back on necessities. You spend down your savings to keep up with your payments. Then you open the retirement fund. Then you use the credit cards. And when you’ve gone through everything you have, and done everything you can, you have no choice but to default on your loan. And so your home joins the nearly six million others in foreclosure or at risk of foreclosure across the country, including roughly 150,000 right here in Arizona.

But the foreclosures which are uprooting families and upending lives across America are only one part of this housing crisis. For while there are millions of families who face foreclosure, there are millions more who are in no danger of losing their homes, but who have still seen their dreams endangered. They are families who see “For Sale” signs lining the streets. Who see neighbors leave, and homes standing vacant, and lawns slowly turning brown. They see their own homes – their largest single assets – plummeting in value. One study in Chicago found that a foreclosed home reduces the price of nearby homes by as much as 9 percent. Home prices in cities across the country have fallen by more than 25 percent since 2006; in Phoenix, they’ve fallen by 43 percent.

Even if your neighborhood hasn’t been hit by foreclosures, you’re likely feeling the effects of the crisis in other ways. Companies in your community that depend on the housing market – construction companies and home furnishing stores, painters and landscapers – they’re cutting back and laying people off. The number of residential construction jobs has fallen by more than a quarter million since mid-2006. As businesses lose revenue and people lose income, the tax base shrinks, which means less money for schools and police and fire departments. And on top of this, the costs to a local government associated with a single foreclosure can be as high as $20,000.

The effects of this crisis have also reverberated across the financial markets. When the housing market collapsed, so did the availability of credit on which our economy depends. As that credit has dried up, it has been harder for families to find affordable loans to purchase a car or pay tuition and harder for businesses to secure the capital they need to expand and create jobs.

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 deepen – a crisis which is unraveling homeownership, the middle class, and the American Dream itself. But if we act boldly and swiftly to arrest this downward spiral, every American will benefit. And that’s what I want to talk about today.

The plan I’m announcing focuses on rescuing families who have played by the rules and acted responsibly: by refinancing loans for millions of families in traditional mortgages who are underwater or close to it; by modifying loans for families stuck in sub-prime mortgages they can’t afford as a result of skyrocketing interest rates or personal misfortune; and by taking broader steps to keep mortgage rates low so that families can secure loans with affordable monthly payments.

At the same time, this plan must be viewed in a larger context. A lost home often begins with a lost job. Many businesses have laid off workers for a lack of revenue and available capital. Credit has become scarce as the markets have been overwhelmed by the collapse of securities backed by failing mortgages. In the end, the home mortgage crisis, the financial crisis, and this broader economic crisis are interconnected. We cannot successfully address any one of them without addressing them all.

Yesterday, in Denver, I signed into law the American Recovery and Reinvestment Act which will create or save three and a half million jobs over the next two years – including 70,000 in Arizona – doing the work America needs done. We will also work to stabilize, repair, and reform our financial system to get credit flowing again to families and businesses. And we will pursue the housing plan I am outlining today.

Through this plan, we will help between seven and nine million families restructure or refinance their mortgages so they can avoid foreclosure. And we are not just helping homeowners at risk of falling over the edge, we are preventing their neighbors from being pulled over that edge too – as defaults and foreclosures contribute to sinking home values, failing local businesses, and lost jobs.

But I also want to be very clear about what this plan will not do: It will not rescue the unscrupulous or irresponsible by throwing good taxpayer money after bad loans. It will not help speculators who took risky bets on a rising market and bought homes not to live in but to sell. It will not help dishonest lenders who acted irresponsibility, distorting the facts and dismissing the fine print at the expense of buyers who didn’t know better. And it will not reward folks who bought homes they knew from the beginning they would never be able to afford. In short, this plan will not save every home.

But it will give millions of families resigned to financial ruin a chance to rebuild. It will prevent the worst consequences of this crisis from wreaking even greater havoc on the economy. And by bringing down the foreclosure rate, it will help to shore up housing prices for everyone. According to estimates by the Treasury Department, this plan could stop the slide in home prices due to neighboring foreclosures by up to $6,000 per home.

Here is how my plan works:

First, we will make it possible for an estimated four to five million currently ineligible homeowners who receive their mortgages through Fannie Mae or Freddie Mac to refinance their mortgages at lower rates.

Today, as a result of declining home values, millions of families are “underwater,” which means they owe more on their mortgages than their homes are worth. These families are unable to sell their homes, and unable to refinance them. So in the event of a job loss or another emergency, their options are limited.

Right now, Fannie Mae and Freddie Mac – the institutions that guarantee home loans for millions of middle class families – are generally not permitted to guarantee refinancing for mortgages valued at more than 80 percent of the home’s worth. So families who are underwater – or close to being underwater – cannot turn to these lending institutions for help.

My plan changes that by removing this restriction on Fannie and Freddie so that they can refinance mortgages they already own or guarantee. This will allow millions of families stuck with loans at a higher rate to refinance. And the estimated cost to taxpayers would be roughly zero; while Fannie and Freddie would receive less money in payments, this would be balanced out by a reduction in defaults and foreclosures.

I also want to point out that millions of other households could benefit from historically low interest rates if they refinance, though many don’t know that this opportunity is available to them – an opportunity that could save families hundreds of dollars each month. And the efforts we are taking to stabilize mortgage markets will help these borrowers to secure more affordable terms, too.

Second, we will create new incentives so that lenders work with borrowers to modify the terms of sub-prime loans at risk of default and foreclosure.

Sub-prime loans – loans with high rates and complex terms that often conceal their costs – make up only 12 percent of all mortgages, but account for roughly half of all foreclosures.

Right now, when families with these mortgages seek to modify a loan to avoid this fate, they often find themselves navigating a maze of rules and regulations but rarely finding answers. Some sub-prime lenders are willing to renegotiate; many aren’t. Your ability to restructure your loan depends on where you live, the company that owns or manages your loan, or even the agent who happens to answer the phone on the day you call.

My plan establishes clear guidelines for the entire mortgage industry that will encourage lenders to modify mortgages on primary residences. Any institution that wishes to receive financial assistance from the government, and to modify home mortgages, will have to do so according to these guidelines – which will be in place two weeks from today.

If lenders and homebuyers work together, and the lender agrees to offer rates that the borrower can afford, we’ll make up part of the gap between what the old payments were and what the new payments will be. And under this plan, lenders who participate will be required to reduce those payments to no more than 31 percent of a borrower’s income. This will enable as many as three to four million homeowners to modify the terms of their mortgages to avoid foreclosure.

So this part of the plan will require both buyers and lenders to step up and do their part. Lenders will need to lower interest rates and share in the costs of reduced monthly payments in order to prevent another wave of foreclosures. Borrowers will be required to make payments on time in return for this opportunity to reduce those payments.

I also want to be clear that there will be a cost associated with this plan. But by making these investments in foreclosure-prevention today, we will save ourselves the costs of foreclosure tomorrow – costs borne not just by families with troubled loans, but by their neighbors and communities and by our economy as a whole. Given the magnitude of these costs, it is a price well worth paying.

Third, we will take major steps to keep mortgage rates low for millions of middle class families looking to secure new mortgages.

Today, most new home loans are backed by Fannie Mae and Freddie Mac, which guarantee loans and set standards to keep mortgage rates low and to keep mortgage financing available and predictable for middle class families. This function is profoundly important, especially now as we grapple with a crisis that would only worsen if we were to allow further disruptions in our mortgage markets.

Therefore, using the funds already approved by Congress for this purpose, the Treasury Department and the Federal Reserve will continue to purchase Fannie Mae and Freddie Mac mortgage-backed securities so that there is stability and liquidity in the marketplace. Through its existing authority Treasury will provide up to $200 billion in capital to ensure that Fannie Mae and Freddie Mac can continue to stabilize markets and hold mortgage rates down.

We’re also going to work with Fannie and Freddie on other strategies to bolster the mortgage markets, like working with state housing finance agencies to increase their liquidity. And as we seek to ensure that these institutions continue to perform what is a vital function on behalf of middle class families, we also need to maintain transparency and strong oversight so that they do so in responsible and effective ways.

Fourth, we will pursue a wide range of reforms designed to help families stay in their homes and avoid foreclosure.

My administration will continue to support reforming our bankruptcy rules so that we allow judges to reduce home mortgages on primary residences to their fair market value – as long as borrowers pay their debts under a court-ordered plan. That’s the rule for investors who own two, three, and four homes. It should be the rule for ordinary homeowners too, as an alternative to foreclosure.

In addition, as part of the recovery plan I signed into law yesterday, we are going to award $2 billion in competitive grants to communities that are bringing together stakeholders and testing new and innovative ways to prevent foreclosures. Communities have shown a lot of initiative, taking responsibility for this crisis when many others have not. Supporting these neighborhood efforts is exactly what we should be doing.

Taken together, the provisions of this plan will help us end this crisis and preserve for millions of families their stake in the American Dream. But we must also acknowledge the limits of this plan.

Our housing crisis was born of eroding home values, but also of the erosion of our common values. It was brought about by big banks that traded in risky mortgages in return for profits that were literally too good to be true; by lenders who knowingly took advantage of homebuyers; by homebuyers who knowingly borrowed too much from lenders; by speculators who gambled on rising prices; and by leaders in our nation’s capital who failed to act amidst a deepening crisis.

So solving this crisis will require more than resources – it will require all of us to take responsibility. Government must take responsibility for setting rules of the road that are fair and fairly enforced. Banks and lenders must be held accountable for ending the practices that got us into this crisis in the first place. Individuals must take responsibility for their own actions. And all of us must learn to live within our means again.

These are the values that have defined this nation. These are values that have given substance to our faith in the American Dream. And these are the values that we must restore now at this defining moment.

It will not be easy. But if we move forward with purpose and resolve – with a deepened appreciation for how fundamental the American Dream is and how fragile it can be when we fail in our collective responsibilities – then I am confident we will overcome this crisis and once again secure that dream for ourselves and for generations to come.

Thank you, God Bless you, and God bless America.

- President Barack Obama

CNN’s Dan Lothian Report

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It feels that the government steps as announced by Paulson and the Fed does not go deep down into the root of the foreclosure-ridden problems. It is simply a bailout and nothing more. The lenders who are responsible for this terrible foreclosure fiasco are being pulled on to the lifeboat while the ship sinks. The bail out will not do anything to stop the foreclosure rot that has taken on epidemic proportions. Rather it will be instrumental in dragging down the economy further – after all the game is being played with taxpayer’s money.

An integrated and comprehensive plan should reach out towards the ordinary hardworking citizen. They are already feeling the brunt of the Wall Street misdemeanors. If this issue is not addressed then any plan will just be a carbon copy of another. Only this time more taxpayer’s money will be put at risk. The taxpayer is being forced to buy predatory and dangerous loans from lenders who behaved in the most reprehensible and irresponsible manner. Multi million dollars belonging to the people are being pushed in to prop up private financial bodies. Yet millions of families who have been pushed into the chasm of financial ruin will continue to cry and moan.

The steps should aim at stopping 6.5 million foreclosures scheduled to surface within the next few months and by checking the falling property values will something of substance be done. Only those measures that will directly prevent 46 million families from drowning will be considered worth the effort. Only then can the economy begin to push ahead. It is the people who are the economy. Bailing out financial bigwigs is not the same as helping the man in the street facing homelessness.

It is silly to believe that the government will be able to check the foreclosure menace by buying off troubled debts. Mortgages of dubitable value have been sold off as securities that are so highly complex that the mess cannot be untangled. The pieces of the jigsaw cannot be put back into place. It is beyond the capabilities of the government. These securities have been sold to countless investors dotted across the globe.

The regulators and lawmakers have to take up a positive role if they want to save the country.

Or search foreclosures by state…

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In North Virginia Prince William had the highest number of foreclosures with 5.5% of all the houses having entered the foreclosure danger zone. Loudon County came second with 2.8% of the total number of houses sliding into foreclosure. The report was published by George Mason University. Last year the rate for the Washington Metro area was 1.7% high from October to December.

One of the major causes for the high foreclosure rate in Prince William is that a large part of the population consists of Hispanic immigrants. They had dreams which have now turned to nightmares. There are many other causes like predatory lending, job losses especially in the construction sector, and the aggressive anti immigrant policies being pursued. As the mortgage rates continue to rise there are more foreclosures in the offing and the trend will continue in all probability. Spring and summer are usually the seasons when people buy houses but now it is for losing properties.

Local government kitties are in serious difficulty because the property taxes are not being paid. While a house is in foreclosure taxes are not paid – they are paid when the dispute is settled.
Corey A. Stewart of Prince William Board says he views the situation as a short term problem – something that comes in cyclical order. The bust has to follow a boom. The bust of course is the most severe in recent memory but the cycle is bound to pass. That is the silver lining. In fact it has given a rest and pause from the frenetic housing activity that had been going on during the past few years. The market will surely correct itself. The issue is affordable housing.

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ForeclosureListings.com has a comprehensive, searchable database of foreclosures in areas like Columbus, Bronx, Derry, Missoula and in the whole country. Try to search foreclosures by state today! Foreclosure Woes In Prince William County

Cabrillo has received $167,462 for its NeighborWorks Home Ownership Center, from a federal source that has been of late approved by the Congress. Demands for their services are going up and they are gearing themselves to meet it. Their spokesperson comments that the good work is beginning to show and changing the lives of the local people who want to continue to stay in the houses that are their homes.

Counseling is just one of the many measures taken up to stem foreclosures that are sucking dry not only the real estate market and telling on the economy. The sub-prime mortgage with adjustable rate mortgages was introduced to help those who could not avail of prime mortgages because of modest income and low credit ratings. The laudable purpose of the scheme was to make real the great American dream of owning a house fore everybody. Unfortunately the plan went awry. Hunting for quick returns and high commissions, speculators and agents jumped in flush with funds. All one needed was a pulse to get a loan sanctioned. This led to a frenzy of building causing spikes in the real estate. Unfortunately what goes up comes down. The people could not manage with the mortgages once the rates became realistic and began to rise. Like nine pins the houses rolled into foreclosures. The business concerns seeing the fall simply ran away from a bad deal leaving more abandoned houses. Divorce and illness too coupled with localized economic problems too had their say in the matter. A tsunami of foreclosures took over the country dragging down in its wake the entire nation.

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ForeclosureListings.com has a comprehensive, searchable database of foreclosures in areas like Columbus, Bronx, Derry, Missoula and in the whole country. Try to search foreclosures by state today! More Free Seminars To Tackle Foreclosure Menace