For the past few years, the Inland Empire in Riverside County has been one of the fastest growing counties in the state - home to a major housing boom. But now the Inland Empire is pretty much the poster child for the foreclosure crisis. In the newer developments, house after house sits vacant - either up for auction, for sale by a bank or going for what’s called a “short sale” which is when the owner owes more than the house is worth.
SoCal Connected tracked down some surreal sights associated with the crisis - a company that specializes in removing whatever people leave behind in their foreclosed homes. The process is called a “trashout” - a term the company came up with because it perfectly describes what happens. Everything that’s left is dumped in a trailer and taken to the landfill.
Then there’s the guy who started a business to spray-paint dead lawns. That’s right. He paints brown lawns green. We also tag along with a couple of code enforcement officers who are spending more and more of their time having to drain slimy, abandoned pools.
Finally, we meet a typical couple who bought their first home, thinking it was a great investment and tax write-off. Now the place is worth only half of what they paid for it and their neighborhood has almost as many vacant homes as occupied ones.
One of the code enforcement guys sums up the problem in a single sentence - “You know you’re in trouble when the lawns are brown and the pools are green!”
WEB ORIGINAL:
The House that Mama Hill Built - The story of one South Los Angeles community leader caught in the sub-prime mortgage mess.
WEB EXTRAS:
Brown Grass and Green Pools - Brown Grass and Green Pools - SoCal Connected producer Angela Shelley on why field producing is television’s most glamorous job...
Lunch With A Side of Hurt - The SoCal Connected crew stopped to take a lunch break in Lake Elsinore, while filming Foreclosure Alley. There, they met Louie Trujillo, owner of Las Cuatro Milpas Restaurant. Trujillo explained how the Inland Empire’s foreclosure crisis is hurting his business.
FROM THE BLOG::
Federal Aid for Foreclosure Troubles - Guest blogger Peter Viles explains why California and many of its communities hardest hit by the foreclosure crisis stand to receive more than $500 million in federal aid over the next 18 months. Also, in a SoCal Connected web extra, real estate agent J. J. Swanson tells SoCal Connected reporter Lisa Ling and producer Angela Shelley that she’s busier than ever.
CREDITS:
Produced by: Angela Shelley; Edited by: Michael Bloecher
I was deeply moved by the piece. It's sad to see 'The American Dream' fading away for the vanishing middle class by the greed and inaction from our financial sector. The man from Lake Elsinore had it right, the crisis is only to get worse as people with 5-year adjustable mortgages start getting their bills that they can no longer afford. 'Brown Grass & Green Pools with larvae' will be the going thing in the I.E. & California for sometime. Good report, KCET.
Our mortgage has been modified, we are now able to stay in our home for 4 more years....then we can not afford the payments again, what will happen? Is the lenders help in modification of our loan a help, or just a temporary fix? Our goal is to pray the real estate comes back enough to sell and pay our first and second loans of approximately $566,000. My husband is retired, fortunately from the state of California after 38 years, and he has a pension, and will be able to collect Social Security in November. We are blessed, we are some of the lucky ones with an income. I have sold real estate since 1986 in the Santa Clarita Valley, a fairly well heeled area with excellent schools, etc.,, so prices were constantly going up. Now I am struggling like everyone else, I have been fortunate to sell a couple of properties this year, to help pay off credit cards, gas, food, and utilities. My business has come from referrals. My husband worries that in four years when we can no longer afford our modified home loan, what is going to happen? Are we going to go through the harrassing phone calls, people knocking on our door, attorneys and private individuals promising us assistance at a cost of course, lenders seem to play good and evil one person says they understand, the next one who calls yells and threatens. Our second trust deed of a little over $60,000, was the worst, I can't tell you how we where lied to, threatened, etc. Even when two weeks prior to our foreclosure date the first trust deed, agreed to modify our loan, the second would not, stating that now we should be able to make the interest only payment to them, it is a recourse loan and will follow us, to the ends of the earth, or so we have been told. We saw a bankrupcy attorney about claiming bankrupcy, but we have two cars that are paid for, and had paid off the credit cards. We are just house poor! So we were told we would have to buy one of our cars back from the bankrupsy court if we were lucky and were given that option. (We own a 1998 Ford Explorer and a 2004 Chevrolet.) Not luxury cars by any means, and we made the mistake of paying them off, which we assumed responsible people do.
Now to the important part, we were told by our lender on the first trust deed, that the reason we were able to modify our loan, was that we kept in contact with the lender, we did not back down, we did not bury our heads in the sand. No matter how bad and threatening things got, I contacted the lenders every week, yes, every week, I left messages on voice mails for any number and person I had ever spoke with at each of the two lenders, when I had an email I also sent an email. Other Realtors said I was beating a dead horse, I should transfer title to vehicles to friends or relatives, lies about everything under the sun, and play the system. This was not something I or my husband could do. We are honest people and have worked hard, we made a pact that no matter how bad everything got, we were not going to compromise our principles by commiting fraud.
What did our lender finally do? On our first trust deed: two percent interest only for first two years, then three percent interest only for years three and four. Year five it goes to 4.5 percent interest and principle, then year six on at 6.375 percent principle and interest. So you see they did not want another foreclosure property on their hands either. The lender is also hoping that we will sometime within four years be able to pay the loans off with a sale. They know we can no longer afford this home, so we either lose the house in a little over four years, or the lender will nedd to work with us again. And in the next four years we are able to stay in our home, with the combined payments of less than we could rent a much smaller property for in the Santa Clarita Valley. Oh yes, about the second trust deed, they were of no help, and said they are in a position of holding firm, of course they say we have commited fraud, taking a loan that we could not pay, although we have been paying on it for years.
I have since been able to advise anyone I hear of in foreclosure to not give up, keep in weekly contact with the lenders, leave open ended messages: as our situation has changed...we want to work something out that would be agreeable to all parties, etc. Do not give up, you may end up going to a foreclosure sale, but you will know that you did everything possible to try and keep your home. The lenders do not need nor want another foreclosure.
God bless you all and keep thinking positive.
This was a shocker to my senses. I also live in this area where it was filmed. I'd been wondering how-where was all this money coming from with the new people in the area, new homes, women shopping like there was no tomorrow, new vehicles, it was shocking and bewildering how all these young couples-people were earning there living and spending these past years. Now I know.
Lisa Ling did a fabulouse job on this piece as usual, top notch job-it has shocked my senses all evening after watching it.
I hope you show "Foreclosure Alley" more through out the season-year! Great Job Everyone who worked on "Foreclosure Alley". Shocked My Senses to The Core and Beyond, Molly
Joe, I don't think you get it. This mess was not only the greed of financial institutions, but also the greed of the prospective home buyer. Many who are in foreclosure knew that they couldn't afford the payments and no one twisted their arm and made them sign on the dotted line. Those people should take the blame for their own greed. Everyone wants to have a home of their own but some were willing to take excessive risk to buy what they couldn't afford. This has hurt those who stayed within their means by putting us into an economic crisis that we will all pay for in lost jobs, lost investments, etc.
He paid $399K and a house down the street is going for $180K.
He says he made a stupid decision. Yes, he did. But he is compounding it my an even more stupid decision--STAYING IN THE HOUSE. WALK AWAY, IDIOT!!!!
Why can't most of the so called "trash" be given to charity? There were a lot of good clothes and other items I saw thrown in dumpsters. Seems like another great waste. Hopefully they are trying to sort some of it out.
It is difficult to feel sorry for all these people that is caught up with the foreclosure. I wouldn't even feel sorry for myself if I were in their shoe. My wife and I has been moving from rentals to rentals before we save up enough money to put a down payment for a house and we can put in at least 50% of the value. We did not go in immediately but waited for a bubble like this to do it. That happens in the 90's and we have a great house for a great price.
Our house increase in value after 2001, we did not refinance or take any equity from it because we did not need it. We see the prices going up ridiculously and told ourselves to braise for another bubble. Well this is it and we have save up enough to get another house.
This bubble is not going to go away for another six years and we are looking seriously into where the bottom is before we decide to get one.
My point is we have so much resources here to learn and be wise with our investment. We have so called the best education system here yet we look so stupid going into ridiculous loans with terms we know that is going to hurt us when the time comes. We have plenty from where I originated yet we get drunk with greed. We think we are someone but ending up longing to be somebody else and worship those rich and famous like God. We did think that money grows on trees before this bubble and we acted like there is no tomorrow buying all our WANTS and not thinking that much in the future.
We are going down today. History does repeats itself. The Romans had it good just like us but throw it all away being complacent.
We thought we have the freedom.. but look carefully and be wise to see what the government has done. Yes we think we have the freedom. Yes we think that all is fair in this country. The government today is not for the people, is not by the people or even of the people. Is the government afraid of it's people today? The French government is. Look at ours here. Think people who is in-charge of the country. You think you do? Where is our choices for president comes from.. the two big parties and people who are rich. Where are the rest?
It is sad to see that the country have to reach this desperate state to learn. It is sad to see generally the population taken for a ride by its own government. It is sad to see the so call best education system fail to greed. It is sad to see the world most powerful nation could even protect it own citizens from dying due to unavailable health care. What else could I say to create a revolution.
I saved 50% of our income between 2003-08 while all these stupid people were buying homes they couldnt afford. The foreclosure I just bought 2 months ago I have enough to fully pay it off. I am waiting for this bail out to kick in so I can really get a place cheap. Use your brains people and don't be stupid again.
Signed,
Winner
The broadcast was truly moving. Human beings are destined to repeat history time and time again. It is not fair to point the finger at just one party for the blame. The problem was a long time coming. Our government officials wanted increased revenue and cut red tape and turned a blind eye to warning signs. Loan officers encouraged applicants to get all they could get, not afford. Banks eased requirements. Reality companies directed potential clients to appraisers who “could deliver the numbers” and finally potential homeowners ignored common sense and overreached. In my case I was bombarded constantly to refinance my properties. I knew taking out huge loans was irresponsible. I took the conservative approach. I balance my assets between stock, bonds and property and lived within my means. I did not take out “the equality” my property had amassed. However, I am still getting hit pretty hard. I have lost 50% of my stock value in the last 12 months. This was to be the future for my children. It was to provide education and services for their disability and potentially a home for them to live in should they not be able to become gainfully employed.
We all knew that the market could not sustain the rapid growth. It was artificially created by loose lending practices of which our elected officials grossly failed to perform their sworn duty to safeguard the interests of the constituents. Both the Democratic and Republican politicians in Washington and Locally are to blame equally. When will special interests stop hurting America? Can’t our politicians do the right thing and put the people first not their political careers.
Are we going to experience the 1930’s again? I hope not. It is wrong for a family to leave behind its memories, dreams and hope. Your broadcast painted a stark picture of what might be for a great many more Americans if our politicians don’t start work together for the common good.
What is next? What about the bonds and special assessments to pay for the infrastructure i.e. the roads, water and sewage? The trigger to this meltdown was our dependence on foreign oil but it was our greed that made it possible.
We need to take responsibility for our future and earn an honest dollar. A fair wage, a flat tax both federally and locally in the State and we need to live within our means.
God Bless America!
This is shocking! I had no idea of the depth and scope of the foreclosure crisis in this area. Thanks for an informative presentation that illustrates the state of our economy. I do hope some enterprising individual or group will find a way to salvage the items left behind so that they could go to those in need instead of a landfill. Seeing those little dresses and family photographs trashed was heartbreaking!
Hey I need...no make that want a big screen TV. How can I contact these guys and pick up a big screen for pennies on the dollar. I can also use a new/semi-new computer for the kids.
Seriously that is a lot of good stuff going to waste. I guess that sums up the entire housing crisis people WASTING money on oversized houses, oversized vehicles, expenisive $1000 oversize purses and undersized overpriced dogs to put in said overpriced purse.
How could I contact these guys that just drow good things away my little brothers need a computer and a lot of those things they just trow away would be usedfull!!!!
to anyone watching this, i urge you to try and buy a foreclosed home. or go to an auction. it's almost impossible, made worse by the bank bailouts which are not forcing these homes into zero-reserve auctions.
Isn't is against the law to landfill electronics with all their hazardous waste? That's the part that made me cringe the most. If the hauling company is dumping the TVs and computers then that's just one more negative consequence of this we will all have to suffer.
Exactly right, I did the same thing. I'm a Generation Y'er who saved every penny and rented during the bubble years (because, duhh, I didn't want an oppressive mortgage). Now I'm supposed to feel bad for foolish people who knowingly lived outside their means?
A great piece.
1st.. Does anybody here not think the first part of this video was not set up to gain sympathy? PLeaseee.. do not insult us. Nobody is going to throw away computers and t.v's in reality. This was a preplanned little show to gain sympathy. DON;T FALL for IT!! Are all those workers making so much money that they are not willing to resell the stuff on ebay.
GIVE ME A BREAK.. STOP the lies..
Teach people how to walk away from the bad decision they made.
I am single, female and take care of my handicap mother under the same 1000 sq ft house. Yes.. It is a bit small but my mortgage is only $250 a month.
DO NOT ASK ME TO BAIL OUT THE FOOLS!!!!
No sympathy here ..
Instead of begging for another loan modification to live in a house 5 times the size of mine just walk away.
For the love of God... Find a 1000 sq ft. house and rent!!!! JUST LIKE YOUR FELLOW PRUDENT citizens.. DO not come begging to me for a bail out..
This is what the government is asking of us now.. To bail out our neighbors living in mcmansions.
TOTAL Insanity..
I came to USA 4 years ago and never able to understand how people can get so much loaned compromising their future income "just because they can" stupid things like "once you own a house you're on top of a bank" or "if you don't do it now you'll never be able of" or even better: " we just 'got an equity line and we're going to Europe/buying a Mercedes"
like money is of no value or will never have to be repaid... now I get it: It will never be paid!
Get the losses mr 125 percent loan to value...
I am shocked that anyone is shocked by this video. I've been hearing about this stuff for at least 6 months now. And why should we pity the former owners for not taking their personal possesions along? Did they really need to pay a moving company to pack up that handful of family photos? Maybe they could have just used their own two hands to do some work themselves. Prudent people don't just abandon stuff like that.
Joe G,
Are you smoking crack? Yes, there are many greedy conmen out there with fancy job titles in the financial industry.
But the middle class brought it on themselves. They fell for the con. Who would buy a home that cost twice as much as it was worth, hoping that some other sucker might misvalue it that much as well? And who would ever have the nerve to cry about it afterward? Oh, poor me, by the time I bought my Amway kit, everyone else stopped falling for it, woe is me.
A comment from the CalculatedRisk blog needs to be forwarded to the company that is doing these trash-outs -
Please call and ask them to try placing ads on CraigsList (http://inlandempire.craigslist.org/ or simply http://www.craigslist.org/) to help avoid some of this stuff going into landfill. This is such a waist!
If they posted the address the morning of, they'd probably get a line of people out there in short order to collect much if not most of the stuff from these homes!
Cn
freecycle.org would be another option for this company. It may be additional work for them, but that waist is simply disgusting!
Cn
Stop voting Republican. They represent ONLY the rich. The reason so many of you are in such a bad situation is due to Republican control of the government.
The only reason the middle class exists (which has only been about eighty years) is due to the Democrats.
But go ahead and vote on stupid emotional issues. Go ahead.
Excellent piece... Horrible story...
NOW imagine how much worse it could be if just one of those trash outs took place in a home that was ILLEGALLY foreclosed on? What? Can't happen you say? An ILLEGAL foreclosure?
I've been fighting an illegal foreclosure initiated by a mortgage servicer named Fairbanks Capital Corp. (n/k/a Select Portfolio Servicing) for 7+ years now. I'm one of more than 281,100 Federal Trade Commission certified victims of Fairbanks per USA/Curry v. Fairbanks ( www.ftc.gov/fairbanks ). To the best of my knowledge, I'm the first homeowner in the country to obtain both permanent injunctions and contempt orders against a servicer without having to file for Chapter 13 protection. Court documents are posted on my website to confirm that the judge called this a "predatory scheme".
What happened to me, and is happening to literally hundreds of thousands, if not millions of homeowners is known as Mortgage Servicing Fraud. MSF is a securitization issue whereas predatory lending is an origination issue. Few homeowners understand that the servicing rights to a loan are sold as separate commodities from the note itself. In fact, the only time a borrower has to be notified of a change of ownership of their note is when the *servicing rights* are sold. The note itself can be sold 100 times but if the servicing rights remain with the same entity the homeowner may *never* know that the note itself was sold. More info is available simply by searching "Mortgage Servicing Fraud" .
Anyone who has a mortgage on their home needs to educate themselves with regard to Mortgage Servicing Fraud as quickly as possible because with the downward spiral of the housing market, servicers are becoming desperate and I suspect that Mortgage Servicing Fraud will only increase as time and markets and the economy drag on.
What happened to me can happen to literally anyone with a mortgage - especially one that has been securitized and led off to Wall St. for slaughter. Please feel free to visit my site for more information on my situation. Drop me a note if you have any questions. I'll be more than happy to answer if I can.
Mike Dillon
Manchester, NH
www.getdshirtz.com
Because after all - all you have to lose , is your home.
Since "the rich" are by definition a minority, how could any party succeed by representing them in a two-party system? I fear that you are oversimplifying just a tad. Anyway, this is false dichotomy, as there is a third choice: the Libertarian Party. The other parties steal from A to give to B, and then from B to give to A.
Libertarians don't steal.
sadly this is just another reflection of the business 'bottom line. . .we don't have to give an f about your pain' mentality that is running western society.
People with student loan default issues are not suprised by any of this. . .bottom line mentality has ruined our lives and now. . .it is catching up with the rest of you all. . .trapping people in debt for any reason. . .even for a house. . I mean come one being over a 1/4 of a million to 1/2 million $$ in debt doesn't scare the crap outta people?
Easy credit has caused the price of housing and college education to increase much more than the cost of living. . .or wages.
So we have large ticket items which are beyond the average wage being sold to that group of people. . while at the same time jobs were disappearing . .okay good jobs were disappearing, plenty of Walmart jobs out there. . . yeah this writing has been on the wall for 26 yrs?
Ah deregulation. . .it just pissed on me.
thousand points of light KMA!
Poor Linda. Bought a half-million-dollar pad and now the meanies want their money. She's a real-estate professional (stamps foot) for goodness' sake! This kind of treatment just isn't right!
really great piece. but man, what a bummer.
The excessively high price of the homes put people at an unnecessarily high risk of foreclosure and the economy could not support the high cost of real estate. The high prices of these homes (compared to the median salaries for that area) almost forced people to get an ARM loan just to afford these houses. Most people don't want to lose their PRIMARY residences, often enough an ARM loan was easier to get than a rental.
Now how did the prices get so high?
**Price manipulation by industry insiders**. Seriously. When the interest rates drop or the access to loans gets easier, the intent is to increase speculation. So that's how the lenders and the banks made their contribution. Then realtors (the "ethical" real estate "professionals") and others in the biz used these ARM loans to speculate, keeping demand and prices high. The lenders and real estate agents/realtors all benefitted from a higher valued property in higher fees, commissions, interest and penalties. Actually brokers got higher payouts for selling riskier loans. They faked this demand. They were acting like investment advisors. Boomers seeking their nest eggs and others thought the unregulated real estate market as an investment was "safe" so speculation added more icing to the cake. There's no guarenteed liquidity in real estate but foreclosure. The stupid lenders created a huge inventory of debt obligations intended for speculation purposes, which is still on their books (collapsing the Lending institutions and banks) and now they want the taxpayers to collect them.
Most people are not earning a dot com salary. Jobs are being lost, inflation is getting higher and gas prices are going WAY up. The correction was going to happen.
Sure some people took out equity loans on their appreciated property and foreclosed due to irresponsibility.
But the numbers are way too high. The borrowers were getting killed here with the economy and the gouging. Unless the bailout contains measures to correct these things, it's going to be an EPIC FAIL.
life on credit was nice !!
70 000$ car,
60 000$ truck,
25 000$ boat
350k $ house,
20 000$ credit card !!
the life was good with master card !!!!!
now it the bay back time ! it time to live like every one ...
Hey Mike,
The Democrats cater to the rich also. Why do you think the rich Hollywood elite loves them. Also, while I am sure there are plenty of Democrats who vote thinking they are helping people they are really creating a dependent class of people (the Poor and Union workers) who will vote for Democrats purely based on the handouts they receive. This is destroying the middle class and America. People need to become self sufficient instead of dependent on others for their care. Sure there will always be those who need our help, but many Democrats could care less about the needy and only care about getting their votes. It is not a black and white issue.
Mike Fairmont .... I don't know where you study Government at, but the majority in the house and senate is Democrat -- guess who's been signing off on most of the junk legislation that has been passed, and not doing their job on the stuff that sits there! I hate to tell you, but there is darn little that the Pres can do all by his lonesome self.
What? They don't have any Goodwill donation spots in California? They'd rather toss perfectly-working items like a big screen TV into the dump rather than allow someone else to buy it (and the proceeds may help OTHER struggling families)?
It looks like the former homeowners aren't the only ones who are making horribly wrong decisions.
The Salvation Army and others will do complete house clearances, so I have no idea what the rush to 'trashout' is. Who's going to buy these McMansions, anyway ? Wouldn't they be more rentable with furniture, TVs and so on in them ?
Good riddance to bad rubbish. If these people can't or won't make the mortgage payments that they agreed to in the contract that they signed, then it's time to step aside and let steadier hands take the wheel.
Who really cares, there were no tricks if you got into a mortgage you cannot afford and bought too much house too bad suck it up and move on the people that did it right should not have to bail all of you morons out.
Excuse me....
but this woman seems waaaay to happy and upbeat reporting this....
they should've qued her to seem more "compassionate"
wow. This is the first report I've seen that really shows the face of the disaster. Thanks for making it
We have a few foreclosures but nothing to that horrible extent is happening here, a settled old community in New England.
Pardon me if I have no sympathy: Get out of the damn cities and start populating the rest of the country. You have a water shortage, an energy shortage, and crazy property costs - move to the midwest where you can put down $100,000 for a three bedroom house and two acres of land.
U-Hauls are cheap. Get out of the population centers.
my husband and i just bought a custom log home in colorado. for years we worked, sometimes 2 jobs and saved. we do not and never have driven new cars, we have 1 credit card, used for gas only, which we pay off each month. we've also gone to second hand clothing stores for everyday wear. we do not buy unless we can pay with cash. we also have enough invested to where we can pay off the house in case of an emergency. we are 2-5 yrs from retiring and are looking forward to that knowing we have been fiscally responsible our whole lives. i have no sympathy for those in forclosure...they know their finances, their income, their savings and their ability to save. we did everything right and are now being asked to bail those out who spent beyond their means. owning a home is a privlege, not an entitlement.
Notice how that talking head has a huge smile on her face the whole time? Nice of her to care, huh?
It reaches all the way down to NE San Diego too. Love those local California municipalities too that don't give a hoot about carving up every last piece of hillside and valley to build a tract, it really disgusts me sometimes and they are as much to blame as "predatory lenders"...now they are choking on the problem all while their tax base gets cut in half...its the very definition of schadenfreude for me. Builders can do whatever they want in Calfornia and zoning is a word they don't know and even care to consider. Its really disgusting. Is there any reason why Lake Elsinore lots should be 5000 sq feet? Are they THAT valuable that people should be forced to live on postage stamp lots they cant even put a playset on? They should be 15,000 to 30,0000 square feet, but developers sell the local govt on a "tract of 1000 homes generating big bucks in tax revenues and everyone gets starry eyed because they are idiots. I bet they wish they hadn't approved all those homes. The only smart ones in all this were the builders, who suckered everyone and got away with it. What's even more sick is that California and the people who run local governments will never learn. They will keep building low quality tract and carving up every last inch of the place until there is no more land, then they will just start building skyscrapers. Anyone know what the ratio is of open space to built-out land in Orange County?
"Notice how that talking head has a huge smile on her face the whole time? Nice of her to care, huh? "
Can you say Botox? Her whole face was artificially frozen. Welcome to SoCal.
I have two friends who got kicked out of their homes. It's depressing to see two families getting kicked out of what they once called home. I remember hearing one of my friends tell me to move out to the inland empire because they were just giving away houses. Now I still have a roof over my head and my two friends barely held on by their fingernails. People got tricked into thinking they could afford these great homes and ended up getting screwed. Like the video says its going to happen again. History repeats itself.
Sorry but people need to quit blaming others and look into the mirror. Sub-prime loans are for people who have already proven that they are not trustworthy. This country is based on credit and entitlement. Only people I feel sorry for are those who are giving up their luxury items like cable tv, cell phones, and eating out in order to make good on their mortgage. This govt bailout is just another way to let American's know that they no longer need to be held accountable for anything!!!
SOMEONE WHO GETS IT!!!!
Kudos to you Julie, I'm in the same boat. Now my IRA's have dropped 35% and my children's college fund 20%. I don't buy what I can't afford. People make bad choices then they want to blame someone else. Just like health insurance, most people choose not to afford it... (yes I know there are acceptions to the rule) but in general most think cell phones and cable TV come before health insurance. Sorry but those are just bad choices. Now my tax dollar is going to bail those people out. bleh!!!
Hint for financial success: do not buy a damned $300k+ house when you make "$3100 a month"
Just don't buy what you cant afford. Rather simple.
I saw a Kim Chee Jar and Shin Raman noodles that lead me to believe that they are korean so they probably returned to Korea.
I'd love to have my own truck and haul all their stuff away, resell it myself and make some cash. If anyone wants to get in on that bussiness idea with me let me know and we can arrange something. seriously, thats literally millions of dollars of materials being thrown away.
Just a reminder to not buy things you can't afford....
Here's what we aren't hearing about foreclosure:
Everyone's heard about the predatory and/or irresponsible lenders and the greedy and/or irresponsible home buyers.
What no one is talking about is how this could have been avoided most simply: do not adjust the mortgage rates. Obviously, all those people who purchased homes with adjustable rate mortgages made their payments for the first couple of years after purchasing their homes. The problem didn't come until the rates adjusted, resulting in people losing their homes, and cities and states losing out on tax revenue.
Everyone loses in this scenario, including people with fixed mortgages who are now seeing their housing values drop, and everyone now engages in the blame game. The simple solution of allowing people who have been paying their mortgages for two or more years to continue doing so would have been a win-win situation for all involved. Obviously, if people were paying their mortgages on time, they were being responsible.
I say this as someone who had an ARM. Before it adjusted, we did not miss a single house payment or property tax payment, we had excellent credit (after paying down debts for two years), and good salaries. When it came time to refinance, however, property values had dropped and we weren't able to do so. However, rather than wait until the last minute and leave everything, we moved out, found a good realtor, and put the house up for a short sale. It sold before it got to foreclosure.
Things happen for a reason. While it was nice to have a house (and it was a modest 1100 sq. foot home), it is even nicer to not have property taxes to pay, a lawn to mow, or to think about the new roof that would have been needed in a few years.
All's well that ends well.
Its very clear you purchased a house well beyond your financial means. People like you expecting a bailout like the 'adjustment' by your mortgage company make me sick.
I think that was his mortgage payment, not his income.
I love all the finger pointing....
First to the almost-retired woman with the $566,000 mortgage. You're stupid. Don't look for sympathy. It was fun while it lasted, but the party's over and you have a huge hangover. I am in about the same life-stage as you. We're a single income household who raised/supported two kids through college - launching them into life without student loans and a $20,000 nest egg to begin their lives - and minimal support for their first 5 years after graduation. Everything we own is paid off (including the 05 BMW and the 09 MDX) and we just broke 7 figures in cash/cash equivalents - even after the market collapse. Our average annual income over the past 20 years was about $70,000/year (much higher now, but we also now put away $100K a year). How did we do it? Simple. Spend only what you have - never raid your home equity or savings. Pay yourself first (savings). Don't revolve credit (pay it off monthly). Live within (or below) your means. It's so simple, it's frightening. My wife doesn't have a closet full of Malono Blahnik shoes and Louis Vuitton bags, but that doesn't make her life any less fulfilling. She prefers running shoes anyway.
For those of you blaming the sitting President / Administration: It's not really entirely the fault of the current sitting administration. If you look to the root cause of the problem, it's Congress that started the fire in 1977. There's this little gem called "Community Reinvestment Act" - signed by Jimmy Carter with an amendment approved by Clinton, and defended by the Democrats, yet many other representatives saw it for what it was. On the surface, it looked good: affordable housing for low income people. The bad part was that poor people are usually poor for a reason - and it's not always income - it's judgment. So the Feds demanded that the banks finance these people who couldn't afford to pay attention, absorbed the loans via Fannie and Freddie, which required issuing liar loans so the banks could reach their quotas of "affordable mortgages" as dictated by Congress - all without adequate reserves to protect the banks from default. Any idiot (well, apparently almost any idiot) could predict what happened next. The other deadly nail in the coffin was the "mortgage brokers" who were paid, not on the performance of the loan, but for closings. They placed garbage, got their money and ran. Once mortgages were granted by banks that had loan committees that looked at the people - even held face to face interviews (as recently as the early 80's) - and made decisions on their creditworthiness. Now? Online loan applications and no income verification loans. The stupidity of it all... why not leave money in bags on the front porch instead?
The time proven ratio of 3x's annual income for housing and housing related expenses still stands true. If you're taking out home equity loans to make your house payment, it's a sign that you have a problem.
Flippers: I live in SoCal - Orange County. I watched my neighbors buying new cars on HELOC's, putting in pools, buying homes in the desert.... all on the artificial increase in their home value. Somewhere along the line, someone forgot what a home is. It's not an "investment" because it's not liquid. It's a place to live. People were buying $600,000 houses, spending $50,000 in upgrades, and flipping them for $800,000 in 30 days. Do you know what? There were lines forming to buy them. It was a fever where greed overcame common sense. I, for one, have no sympathy for a payment buyer. It's the total borrowed, not the payment, that is important. Interest rates cycle - if the 1% difference between a fixed mortgage and a ARM was the difference in affordability for you, it's clear you can't afford the house - let alone the Mercedes, Land Rover, and Porsche on the driveway. If you pay $100K less for the house, but with a higher interest rate, you can always refinance if you maintain your equity when rates adjust. Then you have a cheaper purchase price, lower loan, and ultimately a lower payment at some point in the future. If you don't have 20% down, you shouldn't buy a home anyway. It shows you don't have the self control to save. And before you start whining about "it's because you're rich", I did without luxury items until I could afford them. We're smart about what we do (we do have 5 cells, but share unlimited minutes and texting for $130 a month - all my family has one that I pay for - the same single service is $70 per phone per month from the same carrier for a savings of $250 a month) and we do without stupid things (like $50 a month pay per view sports packages on cable or HBO/Cinemax). I mow my own lawn, wash my own car, paint my own house, clean my own house, do my own home repairs..... not because I can't afford to pay for it, but because it's foolish to pay $40 a week to mow a 3,000 square foot lawn, $40 a month for fertilizer (I do it for about $20 a year). It takes 20 minutes a week.
The trashers: There isn't a market to absorb all the crap that they're cleaning out of these houses. Keep in mind that, if people are losing their homes, who's got the money in those communities to buy this crap? Having cash, I scour Craigslist for cool stuff. I just bought $4,500 (new purchase value without tax) of artisan chairs (if you don't know what that is, it's a hand made piece of furniture, signed by the cabinetmaker, and is of heirloom quality) for $1,000 from someone who lives in Malibu. She was clearing out the house as it appeared she lost it. I bought a table last night for $350 that some young woman bought for $850 in July. She needed the money to make the payments on her M3. This stuff is in brand new condition. However, I wouldn't buy the Packard-Bell computer shown in the clip - it probably couldn't run Windows 95 let alone XP - nor the projection big screen TV that is a power waster. To those who are worried about the environment: the dumps separate the crap in the dumpsters. They are required to by law (not that it means much). This is California aka granola land... land of the fruits and nuts... what's left are flakes.
To the moron who told the guy with the house he's paying $3,100 a month for "to walk away". Yes, legally in CA, you can walk away from a first mortgage used to purchase the house - but not the HELOC's, seconds, or refinances. YOU and YOUR TYPE is what's wrong with this country as you refuse to pay the consequences for your own stupidity and poor decisions. Do the rest of us responsible people a favor - go into the desert and die. I'm sick of paying for your stupidity. You, sir, are a weasel with no character whatsoever. Your mama must be proud.
Anyone with a brain knew that the Inland Empire would collapse. There is little employment out there (it is growing, but it's not self-sustainable as yet), unless you count the endless malls as the land of opportunity. The residents of that area are required to come through Weir Canyon to access LA's job market. It's a horrid commute (unless you pay $6 each way for peak tolls), it's hotter than hell out there (hence the pools and $500 a month electric bills)... anyone with a brain would not consider that a viable option unless your place of employment was local (and stable). The CA transportation system sucks. Each new community added more gridlock. I had the sense to buy close in - not in the fanciest of addresses, but I knew that as the population continued to increase, due to the unbridled illegal immigration we can thank our "leaders" for, that the further out you were from the employment base, the faster your property values would crater when the market inevitably adjusted. The knucklehead in this video has lost in excess of 50% of his purchase price. Me? I'm still ahead of the game. (I moved here in 2002 during the bidding wars). Why? No HELOC. No second. Location, location, location. Will I get out unscathed? Maybe. But I have a far better chance than some fool that bought his "dream home" 60 miles east of LA in a desert far away from any meaningful employment while filling up his SUV's tank with $5 a gallon gasoline for a 120 mile daily commute.
Finally: The $700B bailout of foreign governments that was approved by the House of Representatives: You just got screwed and didn't even get kissed. In case you haven't figured it out on your own, you just bailed out China and the Saudi's. Main Street got nothing more than the bill and some cheesy meaningless tax breaks you would have gotten anyway. What an elimination of the excise tax on toy wooden arrows has to do with this financial morass is beyond me... You should demand your representatives prosecute every person (CEO, senior executives, on down) that obscenely profited from this scheme at your expense. Let them know you're unhappy with the government intervention in the free markets - or you will vote them out of office. If you're too stupid to understand what just happened to you, I pity you. Capitalism is not at fault. In true capitalism, those who took the risks and were rewarded would now be pummeled with losses - painful (like the failure of Lehman), but justifiable. But the "feel good" crowd can't let that happen. They cite the "credit crunch" for slowing down what is truly false economic growth (demand fueled, not by wealth, but debt). Guess what? Just for fun, I applied for a $100,000 unsecured loan from a major bank (I'm not going to take it - it was a bet where I won $100 from some jerk that says no one can get money). I got approved because my FICO is over 800. What does that tell you? Those who are creditworthy can get all the money they want. Those who aren't creditworthy, cannot - and they shouldn't. Nobel laureate economists were against this misguided bailout (and don't get confused by the spin - it's a bailout of investment bankers and foreign governments. The market collapsing after it was signed shows you that the traders know it was a stupid move), yet your "representatives" made it happen. They handed the guy (Hank Paulson), who engineered some of the products that created this financial mess, $700B of your money. You may not realize it, but there is some $3T (that's trillion) of investment capital currently parked because it won't go into a rigged market. $3T of non-government money that would swoop in and buy damaged securities once a value could be determined - without dime one of taxpayer money. To show you how weird it is, investors are buying treasuries with a yield of less than .5%.... just so they don't get caught up in the impending financial implosion that will happen anyway.
Feel better now?
The "Peaceful" 2nd American Revolution needs to get started NOW, before foreigners buy everything we own for pennies on the dollar. For much more:
www.newagecitizen.com
I'm sorry for the families that have to lose their homes, but I agree that greed and materialism plays a big part in this process. I am more SHOCKED by the 'trash out' of these homes, where all that good stuff is going into the landfill. This seems to be the same kind of greed and materialism that caused this problem. NO awareness of what it means to buy or to 'throw away'. What a blight on humanity this entire mess is. From start to finish. SHAME ON YOU ALL!
SAW A BEAUTIFUL PLACE FOR SALE LAST WEEK AT 35,000...IMAGINE BEAUTIFUL AT 35,000????????????????????????/ REGRET MY ILL HEALTH MAKING IT IMPOSIBLE TO GET BACK TO THOSE LANDS WHOSE PRICES AND TAXES FORCED ME OUT/ OLD HOME.............
These people LOST nothing except their delusions. If you put no money down, have no equity...what did you lose! Nothing! The people that have really suffered serious financial losses are those that are NOT forclosed on because they put 20% down! These people are the ones who really suffer.
If you put no money down, have no equity, and barely cover the interest...then you are a RENTER...you were just too dumb to realize it.
I'm sorry but if you spend more than you make then there's going to be a problem down the road.
Excuse me - Ashley! Two families got kicked out of their home? Where have you been??? You only get 'kicked out' if you don't pay your mortgage. I'm soooooooooooo tired of the folks on here who are feeling sorry for these families. Like many here, we have been fiscally responsible for our 20+ years as consumers. We have worked 2 or 3 jobs in the early years just to save the down payment for a home, then worked hard to pay off our home, debts, send kids to college, blah, blah, blah.
No one 'tricked' these people into believing they could 'afford' their homes. Let's face it - they were greedy for a life that was beyond their means. And don't tell me they didn't know it. You can't make 30k a year and believe that you can qualify for a 600k house. Come on!
Now the govt. is bailing out the very people (mortgage companies, credit card companies and all the rest of the Powers That Be) who created this mess. Sorry, I'm not giving them any sympathy.
As to getting rid of all that 'stuff' in their homes to charities; Salvation Army only takes clean, specific things, Goodwill has strong guidelines on what they will accept, and the condition. The owner of the 'trash company' said he does about 15 homes a day - there's no way any charity could pick up all that stuff. Now, I do like the idea of posting these 'trash outs' on the internet somewhere so people who really need the stuff can pick it up. The only downside is you would probably have people lined up and fighting over all this 'free' stuff.