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The “foreclosure trap:” widows an especially vulnerable population

On Behalf of | Dec 14, 2012 | Foreclosures

The term “Catch-22” was an author’s fictional creation meant to describe what has been termed as “a problematic situation for which the only solution is denied by a circumstance inherent in the problem or by a rule.”

Like the following, for example, as aptly demonstrated by the situation confronting a 70-year-old Florida widow, who, like other widows across the country, is in jeopardy of losing her home to foreclosure owing to a paperwork glitch.

That glitch is this: The widow, like many others similarly situated across the United States, was not initially included as a signatory on her home’s mortgage note. Her husband alone was the mortgage holder. He has now died and, in seeking to obtain some debt relief through lowering her monthly payment, the widow has found that she cannot be added to the note because payment on the mortgage is not fully current.

That predicament is far more common that many people realize and, despite a housing market that is generally recovering, an increasing number of widows over 50 years of age are losing their homes because of that paperwork flaw.

Why is that happening? Most often it owes simply to the fact that women generally outlive men and, once alone, often find themselves barely treading water financially owing to pension cuts and other lost revenues that were incoming while their spouses were alive. As a consequence, mortgage payments sometimes slip.

In fact, the organization AARP states that persons over 50 — especially women — comprise the group that is falling into foreclosure faster than any other demographic. Foreclosures have increased by 23 percent for that age group from 2007 through last year.

Their dilemma signals that, notwithstanding evidence that the housing market is slowly recovering, the recovery is uneven and not inclusive of all homeowners. As noted by commentators on housing-related issues, lenders need to adjust lending guidelines for situations involving surviving relatives.

Source: New York Times, “Mortgage catch pushes widows into foreclosure,” Jessica Silver-Greenberg, Dec. 1, 2012

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