Resolution Seeks Temporary Stop to Foreclosures

July 12, 2011

In trying to slow the flood of foreclosures plaguing markets across the country, Rep. Marcy Kaptur, D-Ohio, proposed a House resolution that calls for a temporary national foreclosure moratorium.

The resolution, which was submitted to the House Financial Services Committee last week, called on President Obama to declare a “national residential mortgage foreclosure emergency.” It called on individual states to enact the moratorium, HousingWire reports.

In 2010, mortgage servicers filed 2.9 million foreclosures, according to RealtyTrac. What’s more, the current estimates by housing experts is that the shadow inventory of looming foreclosures that haven’t yet hit the market could be as high as 4 million homes.

"The government should be trying to speed foreclosures, not stop them,” Arnold Kling, economist at George Mason University and former economist at Freddie Mac told HousingWire. "Postponing foreclosures may simply be putting off the inevitable market bottom. We need to remove barriers to foreclosures."

Housing experts say they don’t expect the House Financial Services Committee to approve the proposal.

Source:“House Resolution Advocates Temporary Foreclosure Moratorium,” HousingWire (July 11, 2011)