Foreclosures, bankruptcies, bad credit...what to do?

1. 71

   tritrainposted 13 years ago

   I have a serious question about the state of Americans and all the job losses, defaulted loans, housing market collapse, etc.
   
   Should the government have a one-time reprieve for people that have been damaged by all this?
   
   Bankruptcy effects your ability and rates for loans, insurance, etc for up to 10 years!
   
   There are now many millions facing some combination of the above.
   
   What should be done?

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2. 63

   Daniel Carterposted 13 years ago

   Obviously people won't qualify for loans by big banks. I personally believe that the loss of business will eventually force banks to become more ethical, which they are not at present. I don't think anything should be done. I think the natural course will eventually equalize things for overall benefit.
   
   I survived foreclosure twice. I survived financial ruin three times. The banks only contributed to it. It's horrible stuff. But because of the predatory practices of banks, I do not believe that a reprieve by banks or government will make things better for consumers. It only delays the inevitable, and at this point, big banks are a huge contributor to the condition of the economy and fall out from bad government decisions.
   
   The reset button should happen naturally, not by a pretense and contrivance that the government or bank is helping the consumer. Neither of them are helping consumers in any way.

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   1. 71

      tritrainposted 13 years agoin reply to this

      Wow! 
      
      Well, if you could survive all that, I suppose I might be able to get through a potential foreclosure/bankruptcy.
      
      Trying for a short sell right now.
      
      I really don't want to have to deal with a 10 year punishment...

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      1. 63

         Daniel Carterposted 13 years agoin reply to this

         You can survive and you can rebuild your credit much sooner than 10 years. Bankruptcies and foreclosures stay on for 7 yrs, but if you rebuild credit in other areas, you'll find businesses who extend credit will work with you.
         
         Personally, I do not think this is a good time to buy a home. All indicators I see say the collapse is not really over. It's in a lull for now. I think we'll see more repercussions as a result of predatory banks. They are gutting consumers and leaving them for dead, pretending this won't have any effect on them, but it will, very obviously cause a drought in qualified borrowers and decimate the economy further, thus causing home sales to plummet and glutting the market with real estate that continues to devalue instead regain value.
         
         I doubt that I will ever own a home again. I have no desire to work with lenders as I have in the past. My horrific nightmares with them have all been documented in an effort to try to warn others. Buyer beware.

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         1. 71

            tritrainposted 13 years agoin reply to this

            Those are very sobering statements.
            
            I'm not in a position to buy, and won't be for a while, if ever. 
            
            I do get the impression that we have not hit bottom.  I think this could keep going for another couple years.
            
            I will keep it in mind that I could rebuild my credit faster and keep my rates respectable.  I hope so. 

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3. 71

   tritrainposted 13 years ago

   I think that, if I were not facing this mess personally, I would say to let it play out.
   
   Part of me believes that a fresh start (much like the banks received!) would be helpful to the millions of Americans.  That could jumpstart the economy.
   
   On the other hand, I think that nothing should have been done for the banks or anyone.  Just allow the natural course of things. 
   
   Maybe that would be too much for our economy to bare.  Ugh.

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4. 54

   kmackey32posted 13 years ago

   I bought a home last year.....

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   1. 71

      tritrainposted 13 years agoin reply to this

      Well, maybe you bought toward the bottom and soon they will go back up.
      
      Either way, if you stay in the house for many years to come, it is still worth it to you. 
      
      Imagine that you bought at the peak in 2007!!  Yikes!

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5. 60

   ForeclosureDJensposted 13 years ago

   I don't think there should be a one-time, widesweeping forgiveness... that would undermine the justice and legal system. I do however think that individuals who are challenging and facing foreclosure should be able to contest it, and if it is found that there is mortgage/foreclosure fraud in their case, that they would be "forgiven" of their debts.
   
   In a sense, they are not being forgiven because they did nothing wrong. The real culprits are the banks and lenders who got paid sometimes 3xs for a loan (once by your mortgage payments, once when it was sold to investors, and then again when the government bailed them out). It's despicable when you really research and read about what the mortgage industry has done.
   
   But back to the topic -- if fraud is found in a person's mortgage, then it should be forgiven. In instances where fraud is not found, it should not. I also believe that the banks and lenders who reaped all of the rewards of this should repay back to the government what they received in bailout money, plus a hefty interest rate... just an idea.

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