Get Sick, Get out: The Medical Causes of Home Mortgage Foreclosures‪.‬

INTRODUCTION AND SUMMARY In recent years, there has been national alarm about the rising rate of home foreclosures, which now strike one in every 92 households in America, and which contribute to even broader macroeconomic effects. (1) The handy explanation for the rise in foreclosures is that irresponsible borrowers have been using exotic loan products to purchase homes they cannot in reality afford. (2) Moreover, these buyers allegedly relied on optimistic projections for the housing market, and low interest rates, which have not panned out. (3) Commentators have also pointed to lax lending standards and aggressive practices by brokers as contributing to the increase of high-risk, non-traditional loans that are more likely to foreclose. (4) These factors--loose lending, irresponsible borrowers, a flat real estate market, and rising interest rates--have together become the "standard account" of home foreclosure.