The ensuing foreclosure crisis is highly complex. The problem has been escalating for years; Signs of a "housing bubble" began to appear as early as 2006. Despite the warning signs, the US economy continued to operate, convinced that the "bubble" was not real or that its effect would be minimal. The many parties involved also add to the confusion. Consumers, consumer banks and Wall Street firms all helped cause the crisis. Eventually, the global economy entered a terrible recession. Unable to maintain their subprime loans, many Americans were evicted from their homes. Economists and government officials have looked for ways to alleviate this problem, which continues to ravage the entire economy. Although some progress has been made, much more needs to be done to resolve the problem. A possible solution to the foreclosure crisis must be bipartisan and combine ideas consistent with different ideologies. The best way to solve the problem is to use the resources and capabilities of the private sector. While government can help, business must be at the heart of the solution. In any financial crisis, the private sector is at the center of the problem. Most of the problems faced by the public sector are the result of difficulties in the private sector. If the challenges come from the private sector, then so should the solutions. The first part of the solution includes tax incentives. Financial institutions should receive a tax deduction for each mortgage they refinance. Banks will keep track of all refinanced loans. A report of all refinanced mortgages will be sent to a government auditor who will investigate each...... middle of paper ...... allows financial institutions to refinance subprime mortgages while still benefiting from tax incentives. The government will have a regulatory role under the plan, as government auditors will ensure that tax incentives are only given to legitimately refinanced loans. The plan will give consumers the opportunity to obtain a suitable mortgage loan. As lending practices improve, the real estate market will gradually recover. At the same time, banks will have excellent opportunities to increase their revenues, while investment firms will have ample opportunities to increase their returns, without excessive risk. Ultimately, improving credit and housing markets will contribute to a stronger economy. The future of the global economy depends heavily on credit. Resolving the foreclosure crisis will allow the financial sector to recover, leading to a recovery in the economy as a whole..