MostlyForeclosures Articles: Online Foreclosure Homes Database And Foreclosure Information

Lawmakers at the U.S. House Subcommittee hearing led by Representative Dennis Kucinich have pressed Assistant Treasury Secretary Neel Kashkari on the shift in the way the department used the $700 billion economic rescue fund under the Trouble Asset Relief Program (TARP).

Kashkari, who administers the department’s $700 bailout program, spent the duration of the subcommittee hearing explaining why the money from the economic rescue fund is directed towards banks and not used in buying mortgages to help financially-distressed homeowners.

Kucinich read a section from the TARP bill that stated that the Treasury should help homeowners retain their homes. He pointed out that when the agency decided not to acquire troubled properties, it has passed up the chance to own those mortgage loans and modify them to help people avoid foreclosure.

Kashkari countered Kucinich by pointing out that what is most important and beneficial to the people is that the agency prevented the financial system from collapsing. He adds that the collapse of the financial system would surely result to more foreclosures.

Meanwhile, Representative Darrel Issa criticized the Treasury Department by saying that it cannot be relied upon to protect homeowners from foreclosure.

Representative Elijah Cummings has told Kashkari to use the TARP immediately, adding that various voluntary programs designed for loan servicers to modify loans have failed to produce results. Kashkari cited the loan modifications guidelines by Freddie Mac and Fannie Mae that are somewhat similar to the Federal Deposit Insurance Corp. (FDIC) program.

However, these programs by both government-sponsored lending companies would target stable loans and ignore the subprime market which is the key factor in the economic crisis.

In the end, Kashkari argued that FDIC Commissioner Sheila Bair’s foreclosure prevention plan is not the right use for federal funds because the proposal seeks to restructure risky subprime loans with support from the U.S. government.

Most foreclosure reports have focused on its financial and economic implications to the housing market downturn. Psychologists say that foreclosures also have an emotional side.

Homes play a very important role to people’s lives. It is not just a place to stay, but something that creates ties between and creates a sense of belongingness. Because of this, foreclosure is not just losing a home, but could also stir-up people’s emotions.

Foreclosure means disturbance in financial security, which is threatening. It also involves issues of rejection, abandonment, and isolation. A planned move can already cause stress for most homeowners, so forced move due to foreclosure even more. This situation could bring about twisted emotions.

If the financial side of foreclosure could be work on, the emotional side could be properly dealt with too. A psychologist shares the following tips:

1. Admit your feelings.
   Do not suppress your emotions. Seek someone to confide or find a creative outlet such as drawing or writing to express what you feel.
2. Do not connect negative thoughts to your emotions.
   Try to focus more on productive thinking. Think positive. Instead of feeling sorry for yourself or having self-pity, just work hard to solve your problem.
3. Go on with life.
   Anxiety and regret is a waste of energy. Learn from the past and plan the future. Apply what you have learned from the past to each day that comes to you.
4. Reassure your family.
   Help your children identify their feelings toward moving. Tell them that you are sad to leave your home but you will work hard to make your new home as nice as you can make.
5. Seek for help.
   Be it from a financial counselor or a mental health advisor, it is fine. It may be a sign of weakness but we all have times when we need help.

Foreclosure is not just a horrible experience but a learning experience too.

Foreclosure programs provide much-needed relief for troubled homeowners. They offer extension on loan terms, interest-rate reduction, and principle forbearance. With the economic depression showing little sign of abating, who would not want these?

The trouble with foreclosure plans is precisely that – everybody would want to have a bite of the cake. As more foreclosure prevention schemes come into being, the big dilemma is that there may be no way to distinguish those who need to have their loans readjusted from those who just want to avail of the benefits.

Both the Federal Housing Finance Agency (FHFA) and the Federal Deposit Insurance Corporation (FDIC) have proposed anti-foreclosure programs that allow mortgages to be modified. Both have also placed certain eligibility requirements for borrowers to avail of the benefits. For instance, the FHFA requires homeowners to be able to demonstrate a change in financial situation or some form of hardship.

However, these can be interpreted very broadly to mean a simple job change or more medical bills. While programs restrict eligibility, they will not stem foreclosures.

In fact, these programs may even incite homeowners to skip payments to qualify for a loan reduction. Though missed payments may make it difficult for homeowners to obtain future credit, it is a still tempting proposition especially to those who have little debt, or to those who have no plans in making future loans.

Presently, foreclosures are on the rise, with mortgage companies not knowing how to deal with the deteriorating houses.

Meanwhile, private citizens seem to have a better idea when it comes to solving the foreclosure problem. Barnes and McWhorter, for instance, buy packages of houses from lenders, and sell them to investors in smaller packages. The house is then sold for a slightly lower rate than the standard neighborhood rent.

With this scheme, houses are more easily sold and are saved from deteriorating. It would do well for the current administration to take a hint or two from the Detroit pair.

Data compiled by RealtyTrac Inc. showed that October 2008 foreclosures in Illinois rose by 24 percent from September. This means that one filing is made for every 410 households.

An estimated 12,681 properties in the state are undergoing foreclosure filings that include bank repossessions, default notices and auction sales notices. The numbers represent a 31 percent rise from the 2007 period.

Illinois is the ninth state in the U.S. with the highest number of abandoned homes.

The hardest hit area in Illinois is Cook County with 6,885 foreclosure filings in October. The numbers are more than 50 percent of the overall filings in the state.

Will County received 990 filings while 807 properties were filed in DuPage County.

RealtyTrac Chief Executive Officer James Saccacio said that a drastic drop in new filings has been noted after a law has been passed requiring lenders to delay foreclosure process.

He said that while the goal of the legislation, which is to abate foreclosures, is admirable, an integrated approach such as loan modification is still needed to fully address the problem.

Meanwhile, some realtors in Chicago are dealing with homeowners on short sales. This is the stage when owners are forced to put their homes on the market for less than the total value of the property.

Realtors help homeowners who are already behind their mortgage payments negotiate with banks for the sale of the property. After the agreement to sell the property has been made with banks, realtors will list the said property. This approach gives homeowners a better chance to buy a new home.

Brian Ortiz, a RE/MAX realtor, said that banks have been open and responsive to short sales. He adds that banks are hiring additional employees to address the turnaround problem of short sales.

On the other hand, the John D. and Catherine T. MacArthur Foundation will be investing $68 million in low-interest loans and grants to help alleviate foreclosure problem in Chicago.