Here’s one homeowner that should have sent a thank you card to the lender that foreclosed: [Thanks "Vegas RE" and Rob for the links!]
AVONDALE, Ariz. — The little blue house rests on a few pieces of wood and concrete block. The exterior walls, ravaged by dry rot, bend to the touch. At some point, someone jabbed a kitchen knife into the siding. The condemnation notice stapled to the wall says: "Unfit for human occupancy."
The story of the two-bedroom, one-bath shack on West Hopi Street, is the story of this year’s financial panic, told in 576 square feet. It helps explain how a series of bad decisions can add up to the worst financial crisis since the Great Depression.
Less than two years ago, Integrity Funding LLC, a local lender, gave a $103,000 mortgage to the owner, Marvene Halterman, an unemployed woman with a long list of creditors and, by her own account, a long history of drug and alcohol abuse. By the time the house went into foreclosure in August, Integrity had sold that loan to Wells Fargo & Co., which had sold it to a U.S. unit of HSBC Holdings PLC, which had packaged it with thousands of other risky mortgages and sold it in pieces to scores of investors.
Today, those investors will be lucky to get $15,000 back. That’s only because the neighbors bought the house a few days ago, just to tear it down.
We hear a lot of calls to "stabilize home prices". How does this happen when the home was mortgaged for more than it was worth in the first place? We hear a call for "workouts" and foreclosure moratoriums. On a case-by-case basis, some workouts can be beneficial to lenders and borrowers- but what can be done in cases like this?
The only way to save Ms. Halterman was to kick her out. Ms. Halterman is not alone.
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twist -
SeekingAlpha has even more to this story.
“Little House on PIMCO’s Prairie”, by Micael Steinberg, SeekingAlpha, January 5, 2008.
Stories like this come as no surprise to me, looks like an easy teardown, it’s nothing more than a wooden shack. The neighbors are probably ecstatic. But yeah, the greed, the stupidity, a prime example of Americanism at it’s finest.
John-
Great find!
The banner below all of these guys when they are giving “expert” advice on CNBC should read Talking their book.
my question is “where is the appraiser?” this is a PERFECT example of a bad appraisal. i’m not quite sure why we can’t find the appraiser for the 103K mortgage (along with so many others) and take their license?
The appraiser is a personal friend of mine, leave him alone! His name is Bo Gus Deal and he is a good guy, me and the rest of his friends just call him Stretch.
He is very busy, preparing appraisals for banks to modify loans now, and hopefully in the future, for the government to give money in order to help underwater borrowers. Appraisal is very complex, and requires literally hundreds of hours of study in order to get a license.
After all, that same home could have gotten an appraised value of $1.45 if the purpose was to get a government backed principal reduction for the owner, so obviously, there are complex mathematics involved.
What a scam.
Igor says “silly” Exactly