Responsible Homeownership

As 2008 draws to a close, over 2 million families have already lost their homes or are facing foreclosure. A protracted homeownership crisis will harm both families and entire communities alike and threatens to weaken an already besieged national economy. Yet as policymakers agree to spend billions of dollars to shock the economy back to life, they seem less committed to searching for an effective policy response to address the foreclosure storm and resurrect a responsible housing finance system.

One policymaker has stood out in the search for creative policy solutions. FDIC Chairman Sheila Bair was kind enough to share her perspective from the front lines of the economic crisis and offer her vision of how to make responsible homeownership work in the future. Chairman Bair has been making a forceful case for a systematic and streamlined approach to loan modifications that will help keep millions of Americans from being displaced by loan defaults and foreclosure. Also featured were Roberto G. Quercia, Michal Grinstein-Weiss, and Janneke Ratcliffe from the Center for Community Capital (CCC) at the University of North Carolina Chapel Hill, who presented groundbreaking research that provides a roadmap for making responsible homeownership work, even among lower-income families. Funded by the Ford Foundation, this research evaluates the experience of an innovative program of the Self-Help organization in North Carolina and highlights the potential of linking borrowers with safe and appropriate mortgage products.

Category:

News & Politics

Tags:

• Personal
• Responsibility
• Home
• Ownership
• Mortgage
• Rates
• Interest
• Affordability

[marceads]

There should be no protection. This whole wreck is unfair to those of us who are not credit cripples, have managed their money, and are smart enough to not have fallen for the loans that started this mess. Not everyone is cut out for home ownership as this debacle has proven. I have no sympathy for the people who took these loans. I have deep sympathy for the responsible segment of our country who will face the consequences. Bureaucrats are too far removed to understand this.

[GaryVolts]

The collaboration of misguided bureaucrats and profit seeking business interests in the lending, building, and real estate sales industries has caused huge amounts of damage to low income people and to our economy as a whole.

The bureaucrats invent these things so they can feel good about themselves and wear fancy suits and hold conferences. Private businesses what it does best, which is seek profit. If they must do this by collaboration with policy makers, so be it.

[GaryVolts]

The answer to affordable housing is low prices, not cheap credit.

There are segments of society that are better served by directly renting housing than by renting money to eventually purchase housing. These people don't have other other financial resources to fall back on in slow economic times or perform work that is seasonal or other need to be mobile for work.

The problem isn't how to get everyone into a mortgage, its the original preferential tax treatment given to home owners.

[GaryVolts]

The foreclosures don't hurt everyone. Think of all the people that were forced to be renters because they were priced out by inflation in housing prices.

For every family foreclosed out of their home, a different family gains a home. Its net neutral for families living in homes. Why put the weight of the government in favor of the first group at the expense of the second?

[GaryVolts]

Many people predicted what has happened, they just weren't listened to. They were seen as party poopers.

There wouldn't have been a CRA program if these had been viable lending opportunities in the first place. Banks don't see any color except green.

When banks started selling off loans to other organizations it became in their interest to write any loan, even ones that put homeowners in trouble.