Despite the apparent bounce back of the Dow Jones industrial average which recently reached 10,000 points for the first time in a year, many individuals are still feeling the effects of the economic downturn. Foreclosures in the United States were up 5% from summer to fall with 938,000 foreclosures from July to September alone. The unemployment rate in the U.S. is at a 26 year high of 9.8% and is expected to continue to increase through mid 2010, Associated Press.
Some tips to help weather the downturn:
Check your eligibility for the government’s mortgage refinancing and modification programs at MakingHomeAffordable.gov.
A concise, easy to understand explanation of how irresponsible lending sparked a global financial crisis is provided by the radio program, This American Life, show #355 “the Giant Pool of Money,” transcript and episode link (free streaming).
Under the category of “should have known better” Edmund Andrews, an economic reporter for the New York Times, tells the story of the part he played in the housing bubble in his book “Busted:Life Inside the Great Mortgage Meltdown.” Excerpt, New York Times Magazine. Book review, Salon. More information on Andrews’ story, including financial information he left out, The Business Insider.
Arthur M. Schack, a judge in Brooklyn is being hailed for his insistence that mortgage lenders who wish to foreclose on homeowners have all of the necessary paperwork when they come to court. Schack says he began to see a rise in foreclosure proceedings in 2007. He has thrown out 46 of the 102 foreclosure cases that have come before him in the past two years, New York Times. Homeowners facing foreclosure should check to be sure the foreclosing bank actually holds the mortgage.
Using analysis from real estate website Zillow, the Wall Street Journal finds that foreclosures are increasing among wealthy homeowners. The study, which broke homes into three tiers based on value, found that homes in the top tier accounted for 30 of foreclosures, up from 16% earlier in the year, Wall Street Journal.