The banking industry’s failure to immediately act on the budding foreclosure problem is being blamed for the worsening foreclosure crisis. Experts claim that banks have not only delayed but also obstructed several attempts to address the foreclosure problem when it was still in its infancy. In fact, lobbyists are still at it and are blocking efforts to repair the problem, including the effort being backed by President Barack Obama to give authority to the bankruptcy courts to reduce mortgage debts.

Some business advocates admit that their strategy was to buy time and oppose regulation. These people, who wanted to remain anonymous for fear of career backlash, said their clients including Citigroup, Bank of America and JPMorgan Chase would not have been in their present positions had the banks agreed to systematically address foreclosures than continued hoping for a housing rebound.

The lobbyists are not content with what they have done and are set to fight stop or just limit the coverage of the bankruptcy proposal as well as the new and additional powers that would be granted to judges. Financial institutions however deny responsibility and said they have done their best to prevent the foreclosure problems.