Elbert: Refusal to pare home loans is stalling recovery | desmoinesregister.com | The Des Moines Register

Elbert: Refusal to pare home loans is stalling recovery | desmoinesregister.com | The Des Moines Register:

"The same lenders who helped slam the brakes on the U.S. economy by giving home mortgages to people who could not afford them are now stalling the recovery by refusing to recognize the mountain of bad debt that they helped create.

'There's too much debt overhang' for an economic recovery to gain traction, economist Neil Harl said last week.

'It's going to take three to five years, if we don't do anything more than we are doing now, before consumers are feeling free to spend again,' said Harl, a professor emeritus at Iowa State University.


Recent reports have shifted the nation's economic focus to the struggling housing industry and fears of a double-dip recession.

The Mortgage Bankers Association said Thursday that the threat of home foreclosure is not subsiding. One in 10 U.S. households with a mortgage is now at risk of foreclosure, the report said, and that's after 2.3 million homes have already been repossessed by lenders since the recession began in December 2007."

READ THE REST HERE: http://www.desmoinesregister.com/article/20100829/BUSINESS03/8290325/-1/caucus/Elbert-Refusal-to-pare-home-loans-is-stalling-recovery

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