The Current Housing Crisis in Maryland

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Abstract

The current housing crisis in Maryland has devastated much of the inner city of Baltimore and surrounding counties. The economic collapse of 2008 has left many Maryland residences unemployed or underemployed. The direct impact of the economic collapse has left homeowners wondering how they will pay their mortgages and keep food on the table. Maryland homeowners have been struggling to make ends meet. Some of the issues that are being faced have to do with the predatory lending practices of some mortgage lenders. President Obama signed an agreement to bailout some banks in hope to spare families from losing their homes. Those hopes did not pan out well. There was another bailout of $25 billion dollars allotted in Feb 2012 to help homeowners and reduce mortgages to the principal home values. Thus far the mortgage industry has done as little as possible to hold up their end of that bargain. We need to get educated and hold these predatory lenders accountable.

The Current Housing Crisis in Maryland

By a show of hands, how many people are in a financially challenging situation with paying their mortgage? Do you know that you may very well be a victim of predatory lending practices? You may be asking yourself what is predatory lending. Some of us are familiar with the term. For those who are not, I will explain what a predatory lender is and the effect they have had on our communities.

Predatory lenders and the tactics they use to originate loans with unsophisticated buyers are unfair. We now have predatory legal and rescue services popping up everywhere with the defense that they are here to help us. I intend to provide you with information to free legal services and information to assist in the fight to hold the mortgage lenders accountable for what they are doing.

I am a Baltimore City resident who is upside down in my mortgage. I owe more on my home than it is worth in today’s market. I am currently in the fight to have my mortgage lender do what is right by lowering my principle home value to a fair market price. I currently owe double what my home is worth. Many of us are upside down, have high interest rates or are currently in foreclosure. We are looking for relief from the banks that don’t seem to care much about where our families will sleep once we lose our homes. We need to embarrass them for the way they are treating minorities and low-moderate income families.

Predatory lending practices are a huge contributing factor in the current economic crisis. Many families lost income and the home values have been declining drastically. Saving our homes from foreclosure is the main focus of many families in Maryland. I intend on exposing predatory lending practices that homeowners may not be aware of.

The lack of strong regulations in Maryland has allowed unscrupulous mortgage lenders to take advantage of unsophisticated homeowners. Predatory lending has had a devastating effect on individuals and families. The term “predatory lending” has been used to describe a broad range of loans that are not common in the prime market. These loans do not offer any benefit to the borrower. Some of the most common predatory practices are:

Excessive fees and points
Ignoring borrower’s ability to repay
Balloon payments
Interest only loans
Excessive interest rates
Concealing the true cost of the loan

Federal regulators have warned banks that non-traditional mortgages such as interest-only loans may lead to a rash of defaults when the principal must be paid or interest rates increase. With such loans, the homeowners are not paying towards the principal on the loan, only the interest. Interest rate increases could have a devastating effect on the mortgage payment monthly.

Adjustable rates have the same devastating effect on homeowners. The interest rate is not guaranteed and could fluctuate greatly on a per month basis. With adjustable mortgage loan...
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