Home-Owners And The New Loan Agreement
Many U.S. homeowners had just breathed a sigh of relief - they were able to agree on new loan agreements with lower interest rates. Their homes seemed to be saved, the worst was over. And suddenly, the banks still announced the eviction of millions.
Mark Forster from Lake Oswego in Oregon opened his front door to talk to a neighbor when he noticed a piece of paper that had been taped to the door - the announcement of a forced eviction. Forster was flabbergasted because he had just agreed with his bank and with government agencies to lower his interest rates and get a longer duration of his mortgage.
Forster is just one of many homeowners in the United States that have gone through this ordeal. They believed that they did not have to evacuate their homes after they had negotiated new loan agreements. Now they find themselves in need of a sudden miracle simply because the banks often did not know what the other hand was doing. Bank of America, Chase and GMAC acknowledged the issue and said they would further examine the problem. While they are examining the issue, there are thousands of people being evicted from their homes every single day.
But the causes are much deeper. In several waves, the real estate market saw serious problems arrive. Wave number one was the bursting of the housing bubble because of continuously rising property prices. At the same starting time, the great financial crisis, which happened in 2008, reached its peak. Homeowners, that had seen an increase in value of their property, were now up to their ears in debt. As the appreciation failed to materialize, the value of the property fell, the American dream of home ownership was over.
Wave number two was the rise in unemployment. Suddenly people were finding themselves without a job, and that meant they could no longer afford their mortgages.
Wave number three sweeps across the real estate market, even today. Triggered by the economic and financial crisis, a quarter of all homes in the United States are now 'underwater.' The burden of a mortgage, in many American’s eyes, now exceeds the value of their property.
Since 2008, more than three million homes see foreclosure, which totals more than 15 million. Slowly, the banks are trying to fix the problem they started by closing rescheduling agreements that are funded by the state, or by taking over the property. To do this, certain legal steps have to be taken. Given the mountain of procedures in place, the big American banks are finding themselves overwhelmed. Accordingly, a lot went wrong during the last half of the 2000 decade.
Exact figures on the faulty initiated eviction proceedings do not exist. But Alexa Milton, the homeowner specialist that helps restructure negotiations with its banks, contradicts the findings of institutions like Bank of America: "These are not isolated cases. We know of people who had to go into foreclosure, even though this should have never been necessary. The past six months has become worse for people, not better."
People are tired of being pushed around by big banks, but what can really be done about it? When it comes to employees in the branches of the big banks, which lack the competence of awarding a car loan these days, even they are reaching the limits of their authority. People should only trust a written agreement because verbal ones are not cutting it anymore.
Financial education is important now more than ever, knowing where the stock market is heading will give you a heads up on what you should be investing your money because even in a slow and falling economy you can still make great investments. So, if you want to educate yourself in the stock markets and start building a very profitable portfolio you should start by reading these articles on Learning The Stock Market and looking into How To Buy Stocks For Beginners which will give you the basics you need to know to start investing wisely.