Subprime Crisis
Apolinar Perdomo
ENG112-1101B-59 Phase 3 Individual Project
Colorado Technical University Online
Professor Bruce Nuffer
3/13/2011
The subprime mortgage crisis in the U.S
The argument over who should be at fault for the subprime mortgage crisis and housing market collapse in the United States has been a heated debate. Even though home foreclosure keeps rising, there should be some accountability for the economic meltdown resulting from the subprime mortgage situation. Should we blame banking institutions, mortgage lenders, brokers, and investors for this crisis? Should minorities be blamed for recklessly accepting loans and defaulting on them after realizing they could not meet their obligation? Should we blame the government for their inactions of not protecting victims of predatory lending?
Some will suggest that borrowers, banking institutions, mortgage lenders, brokers and investors, government, and politicians all should share the blame. The bottom line is that no one is taking the blame for this crisis. The fact of the matter is someone has to take the blame for the subprime mortgage situation; moreover, immediate action must be taken to rectify the problem. This economic crisis is a collective effort for each lender, broker, borrower, investor and the U.S government that were influenced by greed. Therefore, how could they rectify this problem? A simple solution to stop the foreclosure crisis is to offer the rights to rent to people that have fallen victims of this crisis.
Congress should temporarily modify the rules on foreclosure to give families facing foreclosure, the right to rent their homes at the market rate for a substantial period of time. This change in foreclosure rules will give banks a real incentive to re-negotiate the conditions under which homeowners can continue to stay in their homes as owners. It will be in the banks best interest, since they don’t want to become landlords. The bank will own the house after a foreclosure,
ENG112-1101B-59 Phase 3 Individual Project
Colorado Technical University Online
Professor Bruce Nuffer
3/13/2011
The subprime mortgage crisis in the U.S
The argument over who should be at fault for the subprime mortgage crisis and housing market collapse in the United States has been a heated debate. Even though home foreclosure keeps rising, there should be some accountability for the economic meltdown resulting from the subprime mortgage situation. Should we blame banking institutions, mortgage lenders, brokers, and investors for this crisis? Should minorities be blamed for recklessly accepting loans and defaulting on them after realizing they could not meet their obligation? Should we blame the government for their inactions of not protecting victims of predatory lending?
Some will suggest that borrowers, banking institutions, mortgage lenders, brokers and investors, government, and politicians all should share the blame. The bottom line is that no one is taking the blame for this crisis. The fact of the matter is someone has to take the blame for the subprime mortgage situation; moreover, immediate action must be taken to rectify the problem. This economic crisis is a collective effort for each lender, broker, borrower, investor and the U.S government that were influenced by greed. Therefore, how could they rectify this problem? A simple solution to stop the foreclosure crisis is to offer the rights to rent to people that have fallen victims of this crisis.
Congress should temporarily modify the rules on foreclosure to give families facing foreclosure, the right to rent their homes at the market rate for a substantial period of time. This change in foreclosure rules will give banks a real incentive to re-negotiate the conditions under which homeowners can continue to stay in their homes as owners. It will be in the banks best interest, since they don’t want to become landlords. The bank will own the house after a foreclosure,
References: Almendarez, L. (2009, July 2). The financial crisis and a fragile global economy. Retrieved from http://www.guardian.bz/all-news/59-other-news/375-the-financial-crisis-and-a-fragile-global-economy Bajaj, V, & Fessenden, F. (2007, November 4). What’s behind the race gap? The New York Times, pp Baker, D. (2008, November 18). Keep it simple: stop the foreclosure crisis with the right to rent. Retrieved from http://www.alternet.org/economy/107572/keep_it_simple:_stop_the_foreclosure_crisis_with_the_right_to_rent/ Bradford, D. (2008). The subprime mortgage meltdown, the global credit crisis and the D&O market Capenni, W (2009). Mortgages went south when illegals came north. Human Events, 65(35), 1-10. Gray, K. (2009, December). Fending off foreclosure. The Progressive, 29-30. Available from Master FILE Premier, Ipswich, MA IBD. (2009, January 16). Fannie, freddie and now, hannie. Investor’s Business Daily. p.N.PAG. Retrieved from EBSCO host. Stiglitz, J. (2008, September 17). How to prevent the next wall street crisis. Retrieved from http://www.cnn.com/2008/POLITICS/09/17/stiglitz.crisis/index.html