Posts (RSS)Bailout in Foreclosures Annoyed Taxpayers
Foreclosures in the nation are centered on 4 states. Even if it is just a few, the whole country would still experience the burden of releasing them from the problem.
RealtyTrac reported that Arizona, Florida, California and Nevada are the top 4 states that generated half the total number of foreclosures a year ago.
People living in those states are only holding a quarter of the country’s mortgages, but their foreclosures continue to rise since the middle of 2007.
Legislators are planning to use $100 billion from the bailout funds to possibly stop foreclosures. The plan was pressed by President Barack Obama a few weeks ago, and the disagreement will be an additional problem for the already puzzled homeowners, economists and politicians.
Jan Hatzius, Chief Economist of Goldman Sachs, said that there are plenty of unsold properties in the market, thus making the prices fall by 20-25 percent by 2010.
Louisiana Republican Sen. David Vitter said that using billions of dollars to assist homeowners may not be the solution to the rising problem.
Some say that the 4 states should not be blamed in terms of foreclosures. Washington D.C., Cleveland, Detroit and Minneapolis are also some of the cities that have high foreclosure rates but are not located in any of the said states.
Lawmakers and economists think that the housing crisis is getting worse, since a lot more people are losing work and cannot pay mortgages.
Meanwhile, University of North Dakota Economics Professor David Flynn questions why people who make the wrong decisions in the financial aspect are always supported. There are some people out there who make the right decisions, but were left ignored.
In all fairness, not all delinquent borrowers were irresponsible. In some cases, loan terms were not fully explained and further assistance were not given.