News / Economy

    Analysts: Foreclosure Mess Hurts US, Global Economy

    Jim Randle
    WASHINGTON — The U.S. housing sector usually leads the rest of the economy out of recession.  But that is happening much more slowly than usual in the wake of the latest downturn.  That is because the housing industry is burdened by a huge number of bad loans that have caused a financial, bureaucratic, and economic mess. Problems in the U.S. housing sector are slowing the economic recovery in the world's largest economy, and elsewhere.

    Deborah Harris faces possible eviction from the home she has owned for the past 17 years, after failing to make some of her mortgage payments.

    Harris was a paramedic with Washington's fire department.

    "Here you are about to lose your home.  It's nowhere else to go.  I don't have any husband, I don't have any children.  I've worked 23 years in the Fire Department, saving lives, keeping people alive, and here I am retired, and I don’t have a place to stay. Come on.  I mean, that's ridiculous," Harris said.

    Harris won awards and promotions for her service on an ambulance, but stopped working after she was hurt carrying a large patient.  

    It took many months of doctor's exams and filing paperwork to convince officials she was entitled to a pension. During that period without pay, she fell behind on her mortgage.  

    The financial crisis that started in 2007 brought rising unemployment, falling home values and surging foreclossures.  

    Foreclosure specialty firm RealtyTrac says foreclosures soared to more than one million a year at the peak of the crisis, from about 200,000 in an average year.

    A slightly better economy has cut the foreclosure rate, but it will probably still hit about 700,000 this year.  

    The chief economist from the National Association of Realtors, Lawrence Yun, says the flood of foreclosures hurts the U.S. economy, which cuts demand for products from other nations and slows global growth.    

    "Foreclosure is the predominant reason for why the housing market is taking a long time to recover," Yun said. "Historically, the housing market always leads the economy, so when housing market goes down, the economy goes into a recession.   When (the) housing market recovers, economy comes out of recession."

    Harris says falling into foreclosure has been a nightmare. "If it had not been for God to help me, I know I could have just gotten a stroke and died, because it was just so devastating, knowing, I didn't know when they were going to come and try to get me out of here," she said.

    Harris is just one of 4.3 million people who have gone all the way through the foreclosure process since the beginning of the financial crisis.  But with help from a community group and a lawyer, she is fighting the foreclosure in court.

    You May Like

    US Leaders Who Served in Vietnam War Look Back and Ahead

    In New York Times opinion piece, Secretary of State John Kerry, Senator John McCain and former Senator Bob Kerrey say as US strengthens relations with Vietnam, it is important to remember lessons learned from war

    Trans-Adriatic Pipeline to Boost European Energy Security

    $4.5 billion-pipeline will become operational in 2020 and will deliver gas from Azerbaijan’s Shah Deniz II field to southern Italy

    Video California Celebration Showcases Local Wines, Balloons

    Annual festival showcases the region's harvested agriculture, fine wines and offers opportunities to experience the gentle breeze in a hot air balloon flight

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Vietnamese-American Youth Optimistic About Obama's Visit to Vietnami
    X
    Elizabeth Lee
    May 22, 2016 6:04 AM
    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video Vietnamese-American Youth Optimistic About Obama's Visit to Vietnam

    U.S. President Barack Obama's visit to Vietnam later this month comes at a time when Vietnam is seeking stronger ties with the United States. Many Vietnamese Americans, especially the younger generation, are optimistic Obama’s trip will help further reconciliation between the two former foes. Elizabeth Lee has more from the community called "Little Saigon" located south of Los Angeles.
    Video

    Video First-generation, Afghan-American Student Sets Sights on Basketball Glory

    Their parents are immigrants to the United States. They are kids who live between two worlds -- their parents' homeland and the U.S. For many of them, they feel most "American" at school. It can be tricky balancing both worlds. In this report, produced by Beth Mendelson, Arash Arabasadi tells us about one Afghan-American student who seems to be coping -- one shot at a time.
    Video

    Video Newest US Citizens, Writing the Next Great Chapter

    While universities across the United States honor their newest graduates this Friday, many immigrants in downtown Manhattan are celebrating, too. One hundred of them, representing 31 countries across four continents, graduated as U.S. citizens, joining the ranks of 680,000 others every year in New York and cities around the country.
    Video

    Video Vietnam Sees Strong Economic Growth Despite Incomplete Reforms

    Vietnam has transformed its communist economy to become one of the world's fastest-growing nations. While the reforms are incomplete, multinational corporations see a profitable future in Vietnam and have made major investments -- as VOA's Jim Randle reports.
    Video

    Video Qatar Denies World Cup Corruption

    The head of Qatar’s organizing committee for the 2022 World Cup insists his country's bid to host the soccer tournament was completely clean, despite the corruption scandals that have rocked the sport’s governing body, FIFA. Hassan Al-Thawadi also said new laws would offer protection to migrants working on World Cup construction projects. VOA's Henry Ridgwell reports.
    Video

    Video Infrastructure Funding Puts Cambodia on Front Line of International Politics

    When leaders of the world’s seven most developed economies meet in Japan next week, demands for infrastructure investment world wide will be high on the agenda. Japanese Prime Minister Shinzo Abe’s push for “quality infrastructure investment” throughout Asia has been widely viewed as a counter to the rise of Chinese investment flooding into region.
    Video

    Video Democrats Fear Party Unity a Casualty in Clinton-Sanders Battle

    Democratic presidential front-runner Hillary Clinton claimed a narrow victory in Tuesday's Kentucky primary even as rival Bernie Sanders won in Oregon. Tensions between the two campaigns are rising, prompting fears that the party will have a difficult time unifying to face the presumptive Republican nominee, Donald Trump. VOA national correspondent Jim Malone has more from Washington.
    Video

    Video Portrait of a Transgender Marriage: Husband and Wife Navigate New Roles

    As controversy continues in North Carolina over the use of public bathrooms by transgender individuals, personal struggles with gender identity that were once secret are now coming to light. VOA’s Tina Trinh explored the ramifications for one couple as part of trans.formation, a series of stories on transgender issues.
    Video

    Video Amerikan Hero Flips Stereotype of Middle Eastern Character

    An Iranian American comedian is hoping to connect with American audiences through a film that inverts some of Hollywood's stereotypes about Middle Eastern characters. Sama Dizayee reports.
    Video

    Video Budding Young Inventors Tackle City's Problems with 3-D Printing

    Every city has problems, and local officials and politicians are often frustrated by their inability to solve them. But surprising solutions can come from unexpected places. Students in Baltimore. Maryland, took up the challenge to solve problems they identified in their city, and came up with projects and products to make a difference. VOA's June Soh has more on a digital fabrication competition primarily focused on 3-D design and printing. Carol Pearson narrates.

    Special Report

    Adrift The Invisible African Diaspora

    World Currencies

    EUR
    USD
    0.8954
    JPY
    USD
    109.74
    GBP
    USD
    0.6851
    CAD
    USD
    1.3148
    INR
    USD
    67.673

    Rates may not be current.