A recent forecast by Housing Predictor has estimated that more than two million homes in the United States will face foreclosure in the next 2½ years; numbers which represent the nation’s worst housing crisis since the U.S. Savings and Loan scandal. In addition to those affected families who have gone into panic mode to stop foreclosure and save their home, legislators have been aggressively seeking solutions to this foreclosure crisis.

National and local legislators have been trying to stop foreclosures through various legislative means, from attacking predatory mortgage lenders to assisting mortgage borrowers to even offering financial assistance to families who may have to stop foreclosure in the immediate future. Learn more about proposed national and state foreclosure laws and stay updated on the latest legislative efforts to stop foreclosure below.

 

Better Business Bureau Provides Tips for Those Who Need to Stop Foreclosure - August 21, 2007

With possibly 1.7 million homeowners at threat of losing their home to foreclosure in the next couple of years, the Better Business Bureau is warning homeowners about foreclosure rescue scams. The BBB detailed last week that foreclosure rescue scam artists will continue to look to take advantage of desperate homeowners trying to stop foreclosure in the next couple of years. The BBB has already heard horror stories of foreclosure rescue scams in all 50 states. With that said, the BBB has provided some tips to homeowners who need to stop foreclosure, including:

1. contacting the BBB or requesting a free Reliability Report at www.bbb.org prior to paying any foreclosure "rescue" company;
2. talking to your lender first about possible means to restructure your loan or refinance;
3. never signing a contract under pressure or transferring ownership of your home;
4. asking someone you can trust to review any paperwork that you may be asked to sign;
5. and filing a complaint with your BBB if taken advantage of by an unethical foreclosure rescue company.

With a recent Business Wire press release indicating that there were 131,574 households in the United States in some stage of foreclosure in July (or one mortgage foreclosure per every 879 households), Democratic presidential hopefuls have begun to address the foreclosure crisis.

Democrats Offer Solutions for The Foreclosure Crisis

Democrats Hillary Clinton of New York, John Edwards of North Carolina, Barack Obama of Illinois and Chris Dodd of Connecticut have all offered their own solutions to stop foreclosure. Campaign watchers have indicated that the mortgage foreclosure topic will be an interesting view in upcoming debates as it will allow these Democrats to convey an idea to the nation that the Republican policies of George W. Bush have especially hurt middle- and lower-income families.

So what exactly are these candidates proposing to stop foreclosure in the United States?

Clinton has said that she would create a $1 billion fund to help those families who need to stop foreclosure. She has also pledged to ban fees that penalize people for making early repayments and would require lenders to give people a better feel of if they could afford their mortgage by providing taxes and insurance in their calculations of monthly mortgage payments.

Clinton has further indicated that she would require lenders to disclose the fact that they make more money from larger mortgages, thus indicating that their advice may not be aligned with the best interests of borrowers. Clinton has suggested that she would like to bolster state licensing standards for mortgage brokers and also publish an online registry detailing a history of complaints against brokers.

Clinton has said that she will introduce her foreclosure legislation after Labor Day. It will be interesting to see if her proposed foreclosure laws are as ambitious as her indications above.

As for Edwards, he has gone after Clinton, saying that she is too late in the foreclosure game. Projecting himself as being the most aggressive candidate on the foreclosure crisis, Edwards has said that he would support a national law that would get rid of abusive lending practices. For example, this national foreclosure law would prohibit balloon loans in which interest rates go up in time and produce mortgages that homeowners can no longer afford.

Edwards also wants to rewrite bankruptcy laws and establish a fund for homeowners who have "underwater" mortgages that are higher than the value of the home.

Like Edwards, Dodd has called out shady lending and noted that he's cosponsored several bills since the beginning of the decade to protect prospective homeowners from predatory lending practices.

As for the Obama camp, the rising Senator has offered legislation that would support counseling for people who need to stop foreclosure and also impose new penalties for mortgage fraud.

And what about the current administration in the White House? A Boston Herald story detailed how the Bush administration has pitted the blame for the foreclosure crisis on the subprime lending market while also saying that the current foreclosure problems are not affecting the economy.

While you may take what you like from the last part of that statement, one thing is certain as Democrat and Republican presidential hopefuls make their bids for the White House in 2008: the foreclosure epidemic will continue to become an important issue of debate.

Here's hoping that political promises will result in actual action to help families stop foreclosure!