The flavor of the foreclosure crisis in the USA has changed dramatically from speculators and people with zero prime loans who never should have received loans in the first place to mainstream homeowners who have had excellent credit history and who have paid 5 to 20 years of mortgage payments on time and in good faith. This new and larger wave of foreclosures is now occurring because of job layoffs and unprecedented business failures directly caused by this extended economic recession depression.
In 2007, seven states alone (ie. California, Florida, Ohio, Texas, Michigan, Georgia and Illinois) accounted for a combined approx 1,400,000 home foreclosure filings out of a nationwide total of approx. 2,200,000 (up 75%). While the 2008 filings have not yet been released, it is estimated that they will exceed the record number of filings in 2007 and so far 2009 looks like it is still rising with the largest wave of foreclosure filings still facing us in 2010. We all know that the big banks such as Bank of America, etc. have received billions of dollars in Federal bailouts, not to mention the government blessed takeover of Countrywide Home Loans, the largest home lender in the USA. However, instead of working in earnest to keep recession affected people in their homes, the big banks and other credit lenders are feeding off the misfortune of the American people and actually trying to force more people into foreclosure by tightening lending requirements, cancelling or freezing lines of credit such as executive credit lines (Helocs)attached to a first mortgage after refinancing, a common practice at Countrywide Home Loans over the last ten years.
The US home foreclosure crisis is a national emergency and a national catastrophe as serious as 911 or Hurricane Katrina disasters. After Hurricane Katrina, New Orleans and the Gulf Coast was designated a National Disaster by the President and qualified for massive Federal financial assistance. Do you know that Hurricane Katrina damaged or destroyed just over 850,000 homes in the entire New Orleans and Gulf Coastal area. By the end of 2010, big bank foreclosures of homes will exceed 2,500,000 forcing nearly 10-15 million once self supporting Americans into crowded and homeless conditions. The cost of supporting these millions of unfortunate victims of the recession will cost trillions of dollars over time and will severely hamper any economic recovery in the foreseeable future. Crime and the pressure on public resources will all but cripple the USA for many years to come. If positive leadership and action could stop this disaster would you support it?
Most of you will recognize this potential catastrophe now looming before us, but few people seem to recognize just how serious this foreclosure crisis has the potential to become. Some of you in our government will want to procrastinate and try to dodge the growing problem, and others will bicker about protocol, precedence, economic and political advantage. Some may urge that we do nothing, which will only serve to ‘exacerbate’ this critical situation, while others will demand action, especially when the details of what is happening has been made known to them. Still others may hope—as I do, however unlikely I feel it to be—to find a means to defuse the crisis through clear thinking, diplomacy and compromise. But whatever our views, however much we may agree or disagree with one another, we’ll still have to come up with a solution or solution to the problem at hand. This foreclosure crisis is a national financial disaster which will snowball until this country is in total financial ruin. The USA and the world is now going through a period of adjustment and crisis will pass if we all pull together in a positive manner. The banks and home lenders should be forced to do what is necessary to give home mortgage holders time to get back in the mainstream in order to resume payments in an orderly fashion. The demise of the USA will most certainly lead the rest of the world into depression, aggression, poverty and ruin. As such, we all must play a pro-active role by writing (emails and letters) to all of our Congressmen and to the President of the United States, Barack Hussein Obama.