Governor Corzine Urges Foreclosure Solution

New Jersey Governor Jon Corzine has called on the U.S. federal government to use a large portion of the $700 billion Troubled Assets Relief Program (TARP) approved by Congress in October 2008 to rescue repossessed properties and prevent further foreclosures.

According to RealtyTrac, foreclosures nationwide during the month of October increased by 5 percent to 279,561compared to the previous month. Since the subprime mortgage crisis started in August 2007, there had been 936,439 homes that have been foreclosed. Analysts predict that the number of nationwide foreclosures for the year 2008 alone will reach one million. Meanwhile, Credit Suisse predicted that there will be 8.1 million foreclosed homes within the four-year period from 2009 to 2012.

Corzine was chosen by the National Governors Association to lead its initiative in fighting foreclosures. He said he is going to talk about the foreclosure crisis at a meeting of the National Press Club in Washington, D.C.

As Corzine described in his interviews with Reuters, his foreclosure prevention and rescue plans include the launching of a national mortgage loan modification program. Loan modification can be achieved by interest rate reduction, loan principal reduction and loan term extension.

Additionally, Corzine called for amendments to the bankruptcy law. He asserted that judges should be given the authority to mediate between lenders and borrowers and that the negotiation process should be automatic in all foreclosure proceedings.

The governor also emphasized the need for consistency in foreclosure prevention initiatives across the country. As of the last months of 2008, there have been several foreclosure prevention programs implemented across the country, such as the initiatives of Pennsylvania Senator Arlen Specter, California Governor Arnold Schwarzenegger, the Federal Deposit Insurance Corporation and other programs launched by states and cities.

Governor Corzine reiterated that it is only the U.S. federal government that can create a consistent and encompassing foreclosure prevention and rescue program.

Related Posts:

• Which Foreclosure Scheme Is Fair to All Parties?
• Refinancing Aid for New Jersey Homeowners Facing Foreclosure
• Repossessed Houses Rising due to Higher Loan Payments
• Freddie Mac Decided to Suspend Government Foreclosures
• Enhanced Foreclosure Help Program Takes Effect in California