Federal Reserve Recommends Short Sales Among Solutions to Housing Crisis
On Jan. 4, Federal Reserve Chairman Ben Bernanke sent a letter and white paper to Congress outlining his insights and recommendations on restoring the health of the U.S. housing market.
Among the key findings on current market conditions:
The white paper suggests that no single solution exists and that progress will come through “persistent and careful efforts to address a range of difficult and interdependent issues”—a position we have always stressed.
Among these efforts, the paper strongly recommends incentives for alternatives to foreclosure, namely a short sale or deed-in-lieu.
The white paper also emphasizes a fact we are all too aware of: foreclosures drive down property values in the surrounding area and lead to a “ripple-effect” that harms homeowners, lenders and taxpayers alike.