Foreclosures in Michigan to See Respite

Senator Carl Levin of Michigan said that many people across the nation have gone through the anxiety that being involved in a foreclosed home would produce. He said that the increase in numbers of foreclosures, including HUD homes, was having an adverse effect on the values of homes, involved in foreclosure or not.

He also said that with Michigan having the fifth highest rate of foreclosures in the country in June, 2008, the State has been affected very severely.

He does hope that the recently passed Housing and Economic Recovery Act of 2008 will turn the tables and undo the damage that the mortgage crisis has caused.

This bill, according to him, will offer solutions to a lot of the current problems and will also offer safeguards against similar situations arising in the future.

He said that the bill has authorized the Federal Housing Administration to provide $300 billion in insuring mortgages. This move could have a positive effect on around 400,000 home owners across the nation by helping them to convert their existing ARM loans to fixed rate mortgages with a 30 years time period. This move, he said, would help households avoid foreclosure and keep neighborhoods together.

The bill is to also provide funds to local communities suffering from a large number of foreclosures. This money is to be used to rehabilitate badly affected neighborhoods.

Talking about how the bill would affect Michigan, he said that the State is to receive $170 million in order to help local neighborhoods. He said that these funds could restore close to 6,000 homes and protect local communities from the values of their homes going down.

He also discussed how the provision of first time home buyers receiving a loan of up to $7,500 as tax credits, would have a positive effect. Not only will it give people wanting to buy their first home a chance, it would also end up reducing the influx of unsold homes, he said.

He also said that it was clear that the current crisis was not just about values of homes going down or the high mortgage costs, but also about the people who stood to lose homes where lives were spent and memories were made.