Although housing prices continue to sink in many communities, Coy and Gopal think that policy makers and big banks are finally taking the necessary steps to deal with the foreclosure crisis and underwater homeowners.
"Lenders and government agencies have finally begun to understand how to deal with the crash by efficiently saving the homes of people who can afford to stay in them-and quickly recycling the properties of delinquent borrowers who are beyond hope. That triage, while painful, is a prerequisite for the eventual recovery of the housing market."
According to Coy and Gopal, "Unclogging the legal and financial system is key to the recovery. The latest improvement is an upsurge in lenders' enthusiasm for short sales as an alternative to foreclosures."
And yesterday's announced settlement over flawed foreclosure practices is adding to the sense that progress is being made on the foreclosure front as the agreement will "keep many struggling borrowers in homes they might otherwise lose."