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Proposed Bill Might Stem the Tide of Cheap Foreclosure Houses



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By : John Cutts    99 or more times read
US Representative Steve Cohen has proposed a bill designed to help control the continuous increase of foreclosures in Tennessee and the entry of cheap foreclosure houses in the market which causes home values to drop. The bill aims to give troubled homeowners more time to solve their property ownership problems.

The state, like most areas in the US, has been hit hard by the housing crisis, with almost all areas and all sectors related to residential real estate suffering from the blow; including Knoxville foreclosure investing which would have been a reasonable venture had it not been for the plummeting prices of homes.

The number of foreclosed homes in Tennessee is expected to rise further in the coming months, with more households receiving foreclosure notices in the past few months. Normally, a borrower who misses a loan payment is given around 15 months before the property is auctioned off for sale. However, in Tennessee, homeowners lose their homes to foreclosure faster than in other areas since out of court processes are the trend in this state.

In most parts of the US, cheap foreclosure houses ended up being so after the judicial foreclosure process has been completed. As opposed to out of court proceedings, the judicial method takes months to complete, which gives homeowners more time to come up with alternative solutions. Not so in Tennessee.

Cohen's bill attempts to prevent properties from going into home foreclosure listings by providing borrowers more time to find ways to pay their loans and make them current. Under the bill, grants will be provided to local governments so that mediation services can be offered to both lenders and homeowners. This will, hopefully, offer a platform where both parties will come up with an agreement to modify the existing loan package or agree on another method to stop or delay a foreclosure.

The bill also includes a provision that will provide funding to local outreach programs so that they can help educate homeowners about existing efforts that can help them prevent foreclosure. Most homeowners are not aware of the existence of some foreclosure mitigation programs launched by the federal government, such as the Making Home Affordable project from the Treasury Department. Cohen's bill plans to educate homeowners regarding such programs and hopefully prevent properties from becoming cheap foreclosure houses.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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