Well, foreclosure rates have declined significantly since the housing market peak of 2008. The reason? Banks and lenders have learned their lesson and set stricter guidelines for people to be approved. Banks are now interested in credit scores, possible collateral for loans, rather than making quick money through high interest rates and fake approvals. The foreclosure rate remains a major economic problem, not to mention the rising unemployment rate. The unemployment rate has reached almost 11% this year due to bank failures like AIG, JP Morgan and Goldman Sachs, which have really hurt the economy. Additionally, American automakers like Ford and General Motors went bankrupt, reducing the number of jobs available in the United States. People are losing their jobs, finding themselves empty-handed when it comes time to pay mortgages. Unfortunately, they are in debt and cannot find work to support their family. Too many people are falling victim to these cruel economic times and losing their homes. My proposal to solve this problem is to restructure the foreclosure practices that banks use. The reason banks do it? Banks have investors they must please; they have annual reports to publish to the public. Like all other publicly traded companies, they are under pressure to produce good results to satisfy investors. They must cover their losses somehow and maintain a reputable image. All the bad loans issued in 2006 with high interest rates generated a quick profit, at the expense of the borrowers. Their income reports were off the charts as they were approving loans left and right. In the short term, they took advantage of the real estate craze. However, in 2008, all...... middle of paper ...... e a family with two working parents totaling an income of $80,000 could afford. It’s now a win-win situation for both parties; the banks receive their money and the family can keep their house. As for the rising unemployment rate, I suggest that banks/lenders grant homeowners a three-month moratorium or leniency period. Banks will agree not to foreclose on the property and let the owner try to get back on their feet. Three months is a reasonable time to find a new job. Missed mortgage payments will be repaid in installments on top of the normal monthly payments until the homeowner is caught up. This is a very powerful incentive for the home owner to not lose their home and maintain their payments. The economy would function smoothly if people did not default on their loans and jobs were not lost due to bank failures...