Fortunately, for many homeowners, a foreclosure notice - aka: posted for foreclosure- rarely results in the loss of one's home. Banks and mortgage companies do not want your home nor do they want to be in the real estate sales business. It's a headache for all concerned.
Fortunately for the homeowner, after their property is posted, avenues toward refinance and alterations to mortgages open up. Thank goodness.
Unfortunately, Monte, that doesn't seem to be happening in many parts of the country. A Northern Virginia county just south of DC is in terrible shape, and the banks aren't helping at all. (And the bigger the bank, the more heartless the lender, it appears.)
There was a frightening story in the Washington Post earlier this week, illustrating that even families with previously unassailably high household incomes are vulnerable. The subject was a multi-income-source family, two earners, total family income considerably >$200,000, two children, living in a modest home with (for Northern Virginia)a modest mortgage. Older child contracts a rare, terminal neurological illness and requires 24/7 attention. (The younger child has the same condition, but it is less advanced.) Enormous medical costs, crazy-making stress, family fell behind in mortgage payments. Family applied for modification of mortgage terms (lower payments), and were told that their application was approved. Then a few days later, they are hit with a formal foreclosure notice and were told rudely by a bank official that the modification-of-terms application had been rejected. (The bank official nastily spelled out the word "r-e-j-e-c-t-e-d" to them over the phone, according to the news story.) Their outlook: eviction within months. Then a postscript in this morning's paper. (Was it merely coincidental to the fecal storm of outrage over the first story?) The bank announced, with fanfare, that it granted the family's appeal and approved the modification of terms. (This is one of the biggest, and IMO, the worst, of the banks.)
Some kind of functioning banking system is required for our modern society.It can't be unregulated and it can't be completely government run.The only thing that has a chance is to separate out the vital functions and protect and regulate them enough so that they continue to function, even when the unregulated speculative parts melt down.That's what the Glass-Steagall act attempted to do in the US, until it was repealed in 1999.
How true!! I was
horrified when Congress repealed Glass-Steagall, with the usual suspects leading the charge for repeal. Human nature and legal precedent declaring that corporate management's overriding duty is to maximize shareholder wealth (interpreted as being measured in the next quarterly earnings report) made the financial disaster a foregone conclusion. You're so correct that Glass-Steagall was inspired by the abuses of financial institutions that were a major cause of the Great Depression.
FWIW, Sen. Carter Glass, a Virginia newspaper owner in my home town, was
anything but a big-government liberal. In fact, he had the views of a feudal baron, and was alleged to have made a public statement to the effect that a working man (early 1900s, remember) "is not worth more than a dollar a day."
My grandparents, who were marginally prosperous during the Depression and hardly radical leftists (my grandfather was a first-line foreman on the railroad), loathed Carter Glass because of his socio-political views.) So, I am convinced that Glass-Steagall was actually a conservative statute designed to prevent anything like the Depression happening again. So long as it was law, the mischief that occurred over the past decade likely could not have happened. Far as I am concerned, its repeal was achieved by the devious leading the stupid.
