Foreclosure Crisis: 'Eminent Domain' Strategy Could Save Struggling Cities
By AMY TAXIN and CHRISTINA REXRODE 07/16/12 03:00 PM ET 
Now – and amid skepticism on many fronts – officials from the surrounding county of San Bernardino and cities of Fontana and Ontario have created a joint powers authority to consider what role local governments could take to stem the crisis. The goal is to keep homeowners saddled by large mortgage payments from losing their homes – which are now valued at a fraction of what they were once worth....Read full article
Via huffingtonpost
During economic crisis, we can't help but feel its adverse effects such as foreclosures. We come to ask
What is foreclosure?
A foreclosure is a specific legal process wherein the lending institution takes back the property from the homeowner who fails to pay the required mortgage payments usually for a period of 3 months. The homeowner then loses his rights for the said property and the lending institution will typically try to resell it.
What is mortgage?
A mortgage is a debt instrument wherein the borrower borrows money from a lending institution in order to buy a real estate property, say a house and lot, which becomes a collateral. The borrower is then obliged to pay back the loan through a predetermined set of payments called mortgage payments. In the event that the borrower stops paying the mortgage payments, foreclosure follows.
Mortgages are used by individuals and businesses to acquire real estate properties without paying the entire value of the purchase up front.
Why do foreclosures happen?
There are several reasons why homeowners stop making payments. Most common of these is getting laid off from work. Other reasons include inability to continue working due to medical reasons, piled up debts and mounting bill obligations, divorce or annulment depending on the country, job transfer, and others voluntarily go into foreclosure.
The term foreclosure is music to the ears of investors but for the homeowners concerned, foreclosure sounds like hell. It seems that real estate investors are taking advantage of the homeowner's difficult situation. On the other hand, the investors with conscience could also feel guilt because of this. But I guess for as long as investors present a win-win solution for both parties, everything would be manageable especially for the homeowner.
Watch below video from foreclosure.com.
