MISSISSIPPI FORUM
By Ed Sivak
Just like in other states across the country, Mississippians are seeing the effects of a sagging economy. More people are unemployed and many working Mississippians have seen their retirement savings decline in value during the past year. As people lose jobs and face financial emergencies with less savings, they become at risk of losing their homes in foreclosure. Foreclosure rates for both prime and subprime loans at the end of the third quarter of 2008 have more than doubled compared to the same period in 2007. When foreclosures do occur, the effects are devastating for working families and communities. Families lose their primary asset and access to affordable credit, and neighboring homes lose value.
Fortunately, several opportunities exist to rectify the challenges associated with foreclosures. The funding of a Housing Trust Fund would elevate Mississippi’s ability to create affordable workforce housing opportunities. Presently, Mississippi is one of only 12 states without a funded housing trust fund. Housing Trust Funds have been successful across the country in the creation of jobs, stabilizing workforce housing and investing back in communities. A statewide trust fund with an ongoing revenue source would benefit Mississippi’s working families through increased economic development opportunities.
One cannot overlook the effects of subprime lending in the state of Mississippi. At the height of the subprime lending boom, Mississippi had the highest rate of subprime lending in the country. Many of the unaffordable products sold to home purchasers -- Option Payment Adjustable Rate Mortgages, No Documentation Loans -- that ultimately made their way to Wall Street as securities were subprime lending products.
By Ed Sivak
Just like in other states across the country, Mississippians are seeing the effects of a sagging economy. More people are unemployed and many working Mississippians have seen their retirement savings decline in value during the past year. As people lose jobs and face financial emergencies with less savings, they become at risk of losing their homes in foreclosure. Foreclosure rates for both prime and subprime loans at the end of the third quarter of 2008 have more than doubled compared to the same period in 2007. When foreclosures do occur, the effects are devastating for working families and communities. Families lose their primary asset and access to affordable credit, and neighboring homes lose value.
Fortunately, several opportunities exist to rectify the challenges associated with foreclosures. The funding of a Housing Trust Fund would elevate Mississippi’s ability to create affordable workforce housing opportunities. Presently, Mississippi is one of only 12 states without a funded housing trust fund. Housing Trust Funds have been successful across the country in the creation of jobs, stabilizing workforce housing and investing back in communities. A statewide trust fund with an ongoing revenue source would benefit Mississippi’s working families through increased economic development opportunities.
One cannot overlook the effects of subprime lending in the state of Mississippi. At the height of the subprime lending boom, Mississippi had the highest rate of subprime lending in the country. Many of the unaffordable products sold to home purchasers -- Option Payment Adjustable Rate Mortgages, No Documentation Loans -- that ultimately made their way to Wall Street as securities were subprime lending products.
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