To avoid foreclosure there is the option of moving into cheaper houses
Michael Zelin, a scholar has a novel answer to the raging problem uppermost in the minds of most Americans. To avoid foreclosure there is the option of moving into cheaper houses that other harassed borrowers want to sell. They too in their turn can further move down.
Those who can afford it generally target moving up the property ladder. They trade their smaller units to shift to expensive localities with better amenities and houses that are better equipped. Moving the reverse way will be equally logical during these troubled days. It is getting replaced but not displaced with one family benefiting another. In this way by moving down the ladder only the family on the last rung of the ladder has to hunt around for an alternative accommodation.
Theoretically Professor Michael Zelin of Kent State University poses and answers these questions. He says that his suggestions are about “balancing dreams with means.” His approach to the housing problem is systematic and not like the piecemeal methods being taken. Right now the deal is only between individual lenders and borrowers. So far this has not had any noticeable impact on the scene.
Whether this novel idea can be translated into reality remains a guess. As yet it is only an idea. Many lenders approve of it. But they are not too eager to be first ones to give it a try. Perhaps it is worth the try. Right now there are millions floating around either homeless or about to be so. But if the professor’s idea materializes then only a fraction would be homeless.
According to reliable estimates about 3 million borrowers will go down in 2009 alone. Many will shift over to stay with friends and families. The lucky few will become tenants if landlords are not too finicky about past foreclosure records. But all told, it is the number of floating homeless people that will increase. Recent surveys of groups that provide services to the homeless say that the majority of their clients have become homeless because of foreclosure.
Despite various measures taken by the government the foreclosure tide has not been appreciably stemmed. Applications for re-negotiation of loans are not working out fast enough to give relief and stop evictions due to foreclosures. It is against this scenario that Zelin is floating his idea. He said, “People do exactly what I’m proposing anyway, but they do it in a nonsystematic way.”
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2 Responses
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That is a novel answer, and a great alternative to what is happening!