Word: affordably
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Dates: during 2000-2009
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There are several reasons why helping people pay for things that they cannot afford already does not work. In the case of housing, the most compelling one is that giving people the ability to pay for a house which will never have any equity value for them simply buys them time to make payments while they find another place to live...
...other reason that mortgage modifications are a challenging way to put a floor under housing prices is that this assumes that people who cannot afford a $500 a month mortgage payment can afford a payment of only $350. But in most cases this does not matter. As people turn away from debt and toward savings, a house is no longer a good mattress in which to store cash. Perhaps more to the point, with joblessness on the rise and many middle class household budgets built around two people working full-time, it does not take much bad luck to undermine...
...that many people who have every chance to stay in their homes do not take that opportunity. They default to a world where they have one less financial obligation and where their burdens of responsibility are less. People are willing to walk away from a home they could possibly afford with the new government assistance, because the economic depression is no longer just a financial reality. It has become a state of mind...
When Florida legislators recently struggled to balance the battered state budget, they decided to plug holes with $190 million from a $300 million affordable-housing trust fund. After all, why should a cash-strapped state shell out money for new home construction when there are tons of vacant homes just waiting to be snapped up? One of the few benefits of a housing crash, theoretically at least, is supposed to be that home buyers who were previously priced out of the market might finally be able to afford a place of their...
...That's true not just in Florida but the entire country. A lack of affordable homes helped spawn the economic crisis in the first place. The past two Presidents made growing homeownership rates a core goal, but to achieve that, they allowed overly loose lending standards. That caused a spike in demand for houses, which in turn raised home prices so steeply that the modest-income people whom Washington hoped to add to the homeowner rolls couldn't afford them - or eventually couldn't afford the monthly payments they had taken on. Meanwhile, affordable home construction became passé. What developer...