Are recent anti-foreclosure laws contributing to a mini-bubble in the housing market?

After the housing market crash in 2008, more than 400 U.S. State and Federal laws were enacted to protect homeowners by helping them stave off foreclosure and stay in their homes longer. But experts believe these laws intended to keep a homeowner from being evicted are leading to a lack of inventory.

Miami leads the nation in the number of foreclosures. However, new laws require a judicial review for a foreclosure can delay the process for up to two years. While this allows some home owners to remain in their home longer, these delays may result in a decrease in inventory.  Consequently, Miami also leads the nation in the number of delinquent loans as a result.

After the housing market crash in 2008, more than 400 U.S. State and Federal laws were enacted to protect homeowners by helping them stave off foreclosure and stay in their homes longer. But experts believe these laws intended to keep a homeowner from being evicted are leading to a lack of inventory.

Miami leads the nation in the number of foreclosures. However, new laws require a judicial review for a foreclosure can delay the process for up to two years. While this allows some home owners to remain in their home longer, these delays may result in a decrease in inventory.  Consequently, Miami also leads the nation in the number of delinquent loans as a result.

“Many state laws that stretch out the period for legitimate foreclosures result in no added benefit for the homeowner and produce harm to the housing finance system and to neighborhoods,” said Alfred Pollard, general counsel to the Federal Housing Finance Agency, at a House of Representatives oversight hearing in March.

Having due process regulation before foreclosing on a home, especially since the “robo-signing” scandal in which banks falsified foreclosure paperwork, is just. But is there evidence that these laws are helping the foreclosure rate or are they just delaying the inevitable?

According to RealtyTrac, 2.2 million American homeowners have lost their homes due to foreclosure since July 2009 with another 720,000 are in some stage of foreclosure.

These delays in foreclosures are causing a decrease in inventory, thus causing a “mini-bubble” in house prices. With fewer homes available, homes are receiving multiple bids. According to www.homepricetrend.com, the median price for homes in Miami is up 7%, which the inventory of homes for sale is down 15%.

Do you think these new foreclosure laws are helping or hurting the housing market. Weigh in with your thoughts!

“Many state laws that stretch out the period for legitimate foreclosures result in no added benefit for the homeowner and produce harm to the housing finance system and to neighborhoods,” said Alfred Pollard, general counsel to the Federal Housing Finance Agency, at a House of Representatives oversight hearing in March.

Having due process regulation before foreclosing on a home, especially since the “robo-signing” scandal in which banks falsified foreclosure paperwork, is just. But is there evidence that these laws are helping the foreclosure rate or are they just delaying the inevitable?

According to RealtyTrac, 2.2 million American homeowners have lost their homes due to foreclosure since July 2009 with another 720,000 are in some stage of foreclosure.

These delays in foreclosures are causing a decrease in inventory, thus causing a “mini-bubble” in house prices. With fewer homes available, homes are receiving multiple bids. According to www.homepricetrend.com, the median price for homes in Miami is up 7%, which the inventory of homes for sale is down 15%.

Do you think these new foreclosure laws are helping or hurting the housing market. Weigh in with your thoughts!

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