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There is not much not to like about my friend's house. It has a four-car garage and sits on a beautifully manicured lawn. The 3-acre property has a lake out back where geese hang out during the summer. The other day, I noticed the house next door was for sale. My friend casually informed me that the home was abandoned some months ago.Looks like the subprime crisis has migrated to the ritzy suburbs. Several homes in this neighborhood have been abandoned, which has forced the neighborhood association to check on the properties to make sure everything is okay. Keep in mind that these homes probably fetched at least $600,000 before the market crashed. Of course, that's all changed now.
Builders flooded the market with spec homes, which is one of the reasons why the market has so much excess inventory. People were eager for their slice of the American Dream, whether they could afford it or not. Bankers were willing to feed these delusions with cockamamie loans that would re-set interest rates at the drop of a hat. There is plenty of blame to go around.
Former Fannie Mae (NYSE: FNM) Chief Executive Franklin Raines blamed regulators for allowing his company to take on more risk with limited oversight. That's rich. Isn't that what Fannie wanted? Isn't that why the company had such a huge lobbying shop?
Meanwhile, "fewer Americans signed contracts to buy previously owned homes in October as credit markets seized up, signaling the housing slump will extend into a fourth year," Bloomberg News said. I know the government and banks have offered all sorts of mortgage assistance programs, but those don't appear to be doing any good. Some people can't wait.
My friend's former neighbors broke into their former house after the mortgage company changed the locks.
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Reader Comments (Page 1 of 1)
12-10-2008 @ 11:54AM
BHarrison said...
. . . and there are STILL many people who are "gaming the recovery system".
My brother-in-law has a neghbor (in a $700,000.00 house) who has not paid any of his mortgage payments in almost a year. However, this guy has PAID CASH (approximately $450k) for an even larger home that had been foreclosed on in a nearby city . . . of course he bought the house using his parents name.
The previous owners of the house had stripped the house of all appliances, fixtures, etc. . . . and they (or others) had broken into the house after the sale was completed to steal even more of the fixures, a/c equipment, etc.
So many of those who bought homes that they could not afford, have stripped the houses before they were evicted. Why should we be concerned about the "welfare" of these types of people. (And my borther-in-law's neighbor even told someone that he intends on stripping his current home before he is evicted.) It has become somewhat of a vicious circle.
These home originally sold for apprximately $185K back in the early 1990s.
This ENTIRE DEBACLE could have been, and WOULD have been TOTALLY AVERTED if Congress and the FED had required that ALL mortgage applicants had been required to be FULLY PRE-QUALIFIED for the mortgages that they applied for.
CONGRESS is the PRIMARY CULPRIT in this entire debacle. And now it turns out that those Congressmen/women who ENABLED the FRAUDS by VEHEMENTLY FIGHTING AGAINST implementation of "voersight and regualtion of the FIs and the corporations, are the primary Congressmen who are "leading" the "recovery efforts". Isn't this TOTALLY illogical? Barney Frank, Mel martinez, Ms. Pelosi, Mr. Reid, Mr. Dodd, etc. need to be removed from Congress.