How Texas has survived the mortgage meltdown.
Posted By admin on April 16, 2010
When the Nation’s mortgages were going under, one of the few states that were able to avoid the debacle was Texas. Was Texas able to avoid it completely? No, of course not. But, Texas was able to prevent the onslaught of upside down mortgages. These are the mortgages where the home owner owes more on the loan than the house is worth. This causes a thought process referred to as “Strategic Foreclosure“.
Texas was able to avoid much of this due to strategic planning by the REALTOR® lobby in Texas. The REALTOR® lobby opposed legislation that would allow home equity loans. Uncontrolled home equity loans allow a homeowner to owe a considerable amount more on their home than its value. The REALTOR® lobby was unable to prevent home equity loans coming to Texas but, they were able to place intelligent boundaries into the process. They pushed for and received critical legislation that prevented a home owner from borrowing more than 80% of their homes appraised value when applying for a home equity loan.
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