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There must be positive analyzing of the foreclosure crisis – why did it happen and what can be done now.
Shaun Donovan is expected in Chicago in the last week of June to talk about affordable housing at a ritzy hotel – Palmer House Hilton. The ceiling of its lobby is replete with nudes and cherubs and bas relief embrace its marble columns. Dotted around are shopping kiosks selling jewellery and secluded bar zones. Donovan is the secretary of HUD. A New Yorker like him also would be impressed by this stage setting. But if he really wants to know about the subject of his talk it is better to knock on South Rockwell Street.
The locality is officially known as Chicago Lawn but the locals refer to it as Marquette Park. It is famous for rows of bungalows that stand as reminders of a bygone industrial age. The industry has vanished but the houses stand there mute witnesses of the past. The houses are still sturdy and capable of sheltering immigrants trying to find a toe hold space in the dream that is America.
Until five years ago this arrangement worked out fine. But the cocaine of no-down -payment mortgages began to flow poisoning the environment. Today the blocks are marked with boarded houses and unkempt gardens. Some families have moved in as tenants of landlords who have vanished. Hooded youth hang around looking around for quick opportunities.
Mike Reardon of Neighborhood Housing Services is a national non-profit entity and has been tracking for years the upswings and downswings of this locality. He commented, “As bad as it is, I never thought there would be banks in Paris and London that would be hurt by this.” Once upon a time when this epicentre of the international financial crisis burst, it was a blue collar neighbourhood. Reardon has noted the facts house by house. He said, “All these properties were in foreclosure less than a year from sale.” Pointing to one house he added, “This building is now owned by Deutsche Bank, the company with the most foreclosures in this ZIP code.”
The moot question is why was this allowed to happen? Why did lenders advance loans more than the worth of the house? Were the banks so naïve that they were unaware of the fact that this was fraud?
However the most important question is that what will happen now? Three things are imperative – active steps coming from the banks to renegotiate loans, stop tenant eviction and refurbish houses and selling them to proper buyers and not absentee investors.
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[...] has suddenly started booming. Experts say that this is largely due to the foreclosure crisis. It has hit hard those who took risky loans. This has combined with increasing credit card dues and [...]
[...] to renters living in foreclosed houses. It mandates notifying of the tenants within 60 days of foreclosure filing. It also gives the tenants a minimum of 30 days to find new accommodation once the foreclosure [...]
[...] In 2007 May the firm organized over 400 auctions dealing with over 50,000 houses and condos – all tainted by foreclosure. Unknown to the bidders each unit has a minimum sale price. If that point is not reached then the auction is rejected. The auctioneer begins with an altruistic note that all this brouhaha is “part of the solution to the current economic and foreclosure crisis.” [...]
[...] market in search of bargain. About one in five (19.6 per cent) says that the decline in prices of foreclosed homes are propelling them towards buying homes. Above 15 per cent people say that they are motivated to [...]