Possing the problem of resolving the foreclosure crisis first raises the question: "Is there really a foreclosure crisis?" » The country is certainly in crisis, but the crisis is not caused by mortgage foreclosure. Foreclosure is simply a mechanism for people to deal with debt they can no longer afford. Rather than being a crisis, the potential onslaught of foreclosures (which has been slowed somewhat by the Obama administration's "Making Home Affordable" program) is actually the product of market forces working hard to clean up the disorder in the real estate market caused by too many cheap properties. money loaned to people who weren't good credit risks to buy homes they couldn't afford. When housing prices are completely out of sync with wages and people who would normally have trouble getting a $20 loan from a friend are able to take out interest-only loans to buy overpriced housing, something really doesn't work. Although it may be painful for many people, the collapse of the housing market, leading to thousands of inevitable foreclosures, is not a crisis, but rather the result of the real crisis: unserviceable debt. Years of cheap credit, combined with government incentives to attract people. to buy homes, debt securitization that masked the risk of substandard loans, and government-sponsored entities (GSEs) that lowered standards for purchasing mortgages created a situation that forced lenders to grant increasingly risky loans. People who had previously been unable to purchase homes had access to credit like never before. With more and more people buying homes, prices soared and real estate emerged as a surefire way to make money. Adjustable rate loans or loans with huge payments were not seen as potentially harmless...... middle of paper ......s more opportunities to live within their means, perhaps even save for a twenty percent down payment and buy a house they can actually afford. While no one likes the idea of ​​kicking people out of their homes, when you buy something you can't afford, you need to return it. When you make a bad business decision, you have to face the consequences. Capitalism doesn't work if there is no downside to risk – that downside is there to ensure the system works. The sanest, strongest, and ultimately gentlest solution to the debt crisis caused by the housing bubble is foreclosure—quick, easy, and simple foreclosure. This is the best way for the real estate market to grow again, which will ultimately give people the opportunity to enjoy the peace of mind that comes from knowing they own a home that 'They can afford it and they can really call it their own..