Solving The Foreclosure Crisis: Not The End Of The Problem, But The Beginning Of The Solution

1157 words - 5 pages

Our nation today has become spoiled with instant gratification. Loans and the borrowing system have given the idea that patience is no longer a virtue and that saving is no longer necessary. Material wealth is increased, but so is the idea of false wealth. People have become so bloated with it; therefore they take on more than they can afford. That is what has happened with our nation’s recent wave of foreclosures. Loans have led everyone to believe that they can own a home and it has omitted the practice of saving. That is where the beginning of the solution lies. Our nation’s people need to relearn the value of patience, therefore we need to learn how to start saving again because ...view middle of the document...

S. No one creates this mess, and things like this do not just happen. To try to solve this, we have to look deep down at the root of the problem.
There are many reasons for foreclosure, including job loss, payment increase or mortgage adjustment, reduced income, along with many other reasons. What do these reasons have in common? They are all due to the bad economy and the homeowners cannot help these circumstances. Nobody would voluntarily choose to stop paying their mortgage, it would be unforeseen circumstances that arise that leaves one without enough to meet their payments. The borrower is left with no choice and clear solution. The borrower is just the outer surface of a deep problem. The problem lies within the system of lending itself. The system of credit that the U.S. relies on allows purchasing based on credit, or the ability to pay bills. Gauged with a credit score, one can increase this by paying more bills. Essentially, to gain a high credit score, one must incur more debt. This is where everything goes wrong. Though material wealth is increased, so is the debt. Unfortunately, people become so inflated with this false wealth that they take on more debt than they can afford. With their high amount of debt, or credit, other purchases including homes become easier. This adds a considerable amount to one’s already high debt. Ultimately, this system allows the people to make purchases based on what they don’t have, rather than on what they really have. If this system is allowed to continue this way, our nation and its citizens will have no real wealth, eternally bound by long term payments.
Although our nation’s foreclosure statistics may seem daunting, there are solutions. The U.S. need to go back to basics and what is meant by basics is saving, then - buy. Americans do not realize the potential of a few years of saving. With things like credit cards and loans giving Americans fast money, the value of patience and hard-earned money is diminished. For example, credit cards allow Americans to make purchases and not worry about it now although they end up paying for it for years. Coupled with interest rates, consumers actually end up paying for more than what the product is worth. The scenario is the same with loans. For example, if one takes a loan for a house, they...

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