The federal government is hoping that a nearing settlement with major banks will provide some relief to homeowners and help ease the housing market across the nation. Many homeowners who've fallen victim to shady mortgage lending practices by major banks are faced with tough financial decisions and some might be facing foreclosure in Memphis and across the nation.

The U.S. Department of Housing and Urban Development says that this settlement could help as many as one million of those homeowners who are nearing foreclosure. The government says that it would directly impact homeowners, allowing many of the one million, who could see relief, keep their homes. The banks would be required to write-down between $20 billion and $25 billion on mortgages in exchange for ending lawsuits against them for past lending practices.

Some people and state government officials say that the settlement doesn't go far enough. They say that it is too lenient on the banks, and wouldn't affect any of the mortgages guaranteed by Fannie Mae or Freddie Mac, which guarantee most of the U.S. mortgages.

The Obama administration is hoping that this settlement combined with redevelopment programs will help improve the housing market, stave off more foreclosures and boost the job market. If this settlement becomes a reality it could possibly help some people, but many more will still be faced with tough choices and financial difficulty.

If someone is facing a foreclosure, they might be wise to speak with a Memphis bankruptcy attorney. An attorney will be able to help a homeowner decide the best plan of action to limit damage to a person's financial future and relieve their debt issues.

Source: Reuters, "One million homeowners may get mortgage writedowns: U.S.," Margaret Chadbourn and Aruna Viswanatha, Jan. 18, 2012