Federal Reserve Board Finance and Economic Discussions Series

The Federal Reserve Board Finance and Economic Discussions Series includes staff working papers on a variety of economic and financial topics of interest to the American public.  For example, Raven Molloy and Hui Shan 's "The Post-Foreclosure Experience of U.S. Households"  looks at  1999 to 2010 data from the credit reports of a large group of individuals.  They concluded, "Although foreclosure considerably raises the probability of moving, the majority of post-foreclosure migrants do not end up in substantially less desirable neighborhoods or more crowded living conditions."

See the links for that report and the complete lists of reports at http://www.federalreserve.gov/Pubs/FEDS/2011/ .

Home Foreclosure Help

To provide foreclosure alternatives the federal government has created MakingHomeAffordable.gov. According to a May 14, 2009 press release, these alternatives "provide incentives for servicers and borrowers to pursue short sales and deeds-in-lieu (DIL) of foreclosure in cases where the borrower is generally eligible for a MHA modification but does not qualify or is unable to complete the process, which helps prevent costly foreclosures and minimizes the damage that foreclosures impose on borrowers, financial institutions and communities." To help consumers determine eligibility for the program, the Making Home Affordable web site includes self assessment tools. The site also warns consumers to beware of foreclosure rescue scams and links to tips for avoiding mortgage modification scams and foreclosure rescue scams.

Consumer and Business Loans

According to a March 3, 2009 press release, the Department of the Treasury and the Federal Reserve Board rolled out the Term Asset-Backed Securities Loan Facility (TALF), part of the Consumer and Business Lending Initiative. The TALF potentially makes $1 trillion available for loans to businesses and households.

The press release explains:

The TALF is designed to catalyze the securitization markets by providing financing to investors to support their purchases of certain AAA-rated asset-backed securities (ABS). These markets have historically been a critical component of lending in our financial system, but they have been virtually shuttered since the worsening of the financial crisis in October. By reopening these markets, the TALF will assist lenders in meeting the borrowing needs of consumers and small businesses, helping to stimulate the broader economy.

Foreclosure Prevention Act of 2008

On April 2 Senators Chris Dodd (D-CT) (Chair) and Richard Shelby (R-AL) (Ranking Member) of the Senate Committee on Banking, Housing and Urban Affairs announced a bipartisan agreement to address the current U.S. housing crisis. Provisions of their proposed Foreclosure Prevention Act of 2008 include:

• providing counseling for those threatened with foreclosure
  
• helping communities deal with abandoned or foreclosed properties
  
• reforming the Federal Housing Administration to make available "affordable, safe, and government-back loans"

For a description of additional provisions, access the announcement on Senator Dodd's Web site. For discussion about the bill, access a March 31 article in U.S. News and World Report entitled "Senators Set to Debate Housing Crisis", or listen to "Senate Debates Bill Aimed at Curbing Foreclosures" on the April 3 morning edition of NPR (National Public Radio).

Foreclosures - Historical Background

Now that foreclosures are a topic of interest due to the subprime mortgage crisis, FRASER (Federal Reserve Archival System for Economic Research) has posted annual reports and other documents related to the Federal Home Loan Bank between 1933 and 1952. Included are reports of other entities that were part of the Federal Home Loan Bank including "the Federal Savings and Loan Corporation created as part of the National Housing Act of 1934 and abolished in 1989; the Home Owners' Loan Corporation created by the Home Owners' Refinancing Act in 1933 and liquidated in 1951, and the Federal Savings and Loan System or Division."