Bernanke Calls for Action in Foreclosure Crisis

The decline in home prices has led to a widespread wave of foreclosures. Ben Bernanke, chairman of the Federal Reserve, explained on Monday that this action must be relieved by means of a concerted effort by the government and private-sector. In the first three months of 2008, foreclosure filings of every kind had increased 112%, and Bernanke is pushing to avoid those foreclosures that can be prevented, citing a direct correlation between a decline in housing prices and an increase in delinquency rates. He proposed “piggy-back loans,” or loans that require low down payments or no down payment at all, to aid foreclosures.

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