Not misplaced, but in terms of evicted pursuant to foreclosure.
Over the weekend I encountered the second such person. The first impressed me as odd, but the second really has me trying t adjust my thinking.
Both of these occurred in what would be considered pretty comfortable, upper middleclass suburbs of Chicago. The first was close friends - apparently they were evicted following non-payment of taxes. Then this weekend we saw a neighbor, said “How’s it going” and were told, “I’ve been better. I just lost my house and have 2 days to be out.”
I just have such a hard time wrapping my head around how someone gets to that point. And when things go south, how do they stick around without making plans? I’d imagine if my financial situation went nuts, I’d sell off belongings and move someplace smaller/cheaper - before the sheriff came a-knocking.
On the flipside, though, I suspect both of these folk were essentially staying in their homes “rent free” for as long as they could - without paying their mortgages/taxes.
And it is weird because, while curious, you really DON’T want to know too much about such situations.
I’ve heard so much about foreclosures over the past few years, but it is different personaly knowing someone involved. The second such instance came as quite a surprise.
So how about you? Know anyone who got evicted from their home?
My wife’s brother and his wife overextended themselves before the housing bubble burst, then he lost his job. He later went back to work but by then he was in default, his mortgage was underwater and everything unraveled.
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I’d imagine if my financial situation went nuts, I’d sell off belongings and move someplace smaller/cheaper - before the sheriff came a-knocking.
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I’d imagine that way too, but seeing it up close, I can understand how powerful the willingness to believe something will work out before the sheriff shows up.
Years ago I had some friends that got evicted from their apartment. Sheriffs showed up and tossed all their belongings onto the curb, they knew it was coming and had called all their family and friends to come by to help pick stuff up and cart it away to storage. They knew they couldn’t pay the rent and spent the last bit not even trying to, but saving up what little they had to try and have enough to get them into someplace else. (Of course, that didn’t work out since no one would then rent to them.)
I’ve known quite a few people that overextended themselves in the mortgage game, but since the banks have oodles of foreclosures going on none of them have been forcibly evicted. In most cases they just turn the keys back over and move out, sometimes months after not paying. I know a few still playing the refinance and loan modification game, living in homes where their current mortgage is three or four times it’s current worth but they just keep finding folks willing to keep pushing paper around and around. It boggles my mind to think of living somewhere for over a decade, owing more than the original price despite all those payments.
A few. The kids go to school at a pretty blue collar/lower middle class school. For a year or two, it seemed like someone we knew through school was always getting foreclosed on. Most of it had to do with job loss - no savings, not a lot of equity - you just can’t hold it together.
Another was one of my girlfriends - she was making really good money and bought a place - then when she got laid off and the market crashed, she was upside down with very little income and very little savings. She was an early victim - IF she could have refinanced, she could have paid the mortgage and was willing to stay, but they wouldn’t let her refinance from a 15 to a 30 with just freelance income. They probably wished they had (and she is probably glad they didn’t).
Yep, a couple in the Detroit area - both lost their jobs during the Great Recession and had terrible times finding new work. By the time they did it was too late to save the house. They stopped paying their mortgage during the foreclosure, sold off some stuff, and managed to pull together enough to pay cash for a new (smaller) home that they now own outright. They bought a house for $20k that a few years earlier was assessed at $150k.
Basically, two pretty together human beings who had an episode of bad luck, but landed on their feet in the end.
Yes, my husband did, after I left him. After I left, he stopped making the payments. Because it was BofA, they didn’t seem to figure it out for a very long time. He lived there over 2 years. Because I didn’t want him to have to move in with me, I helped him stay in it longer. I worked with the people who were handling the foreclosure and got him a few more months. He did pay for those. But yeah guess what, now he’s with me. For a year. Blech!!!
When the housing market bubble burst, and took our economy down with it, there were foreclosed homes all over our neighborhood. At the height of inflated value craze, homes were assessed at between $260-320k. Even now, with some recovery, our home that appraised once for $294 would sell for slightly over half that. I think many of our neighbors found themselves stuck in homes that they couldn’t sell, and when jobs were lost, couldn’t afford. Very sad and troubling times to drive through a once lovely little middle-class neighborhood and see homes that were lovingly cared for and immaculately landscaped sink into some minor disrepair. We were lucky. We purchased in 1994 at a very reasonable price and didn’t have any need to refinance.
My former husband and I lost our house due to his medical bills. He was out of work and collecting SS, I was working but vastly underpaid. We had built our house while he was still (moderately) healthy, and had included a lot of things that catered to his disability. When things started going south, it wasn’t like we could just pick up and move- he had to be within a certain distance of the hospital where he was registered as a transplant patient, and moving into a house or apartment whose history we didn’t know would be taking a pretty significant gamble. We filed Chapter 13 bankruptcy (the one where you still pay on your bills), and as part of that we had to stop paying the mortgage while the paperwork went through. We came dangerously close to auction time (I believe it was scheduled for the next day) when the bankruptcy was approved. Couple more years in the house, paying a significantly reduced mortgage through the bankruptcy court, and husband’s health deteriorated even more, necessitating a change to Chapter 7 and a loss of the house.
I was gone before the final foreclosure went through, but he stayed in the house for a few months past the official discharge date of the bankruptcy, with the permission of the bank (who didn’t want to toss a recently-transplanted patient out on their ear).
Yep, former co-worker. She got fired from her job but found a new one that paid pretty much the same probably two months later. From what I heard she just stopped paying her mortgage when she got fired and never started paying it again for some reason when she found a new job. Didn’t even try to work with the bank or anything, just stayed in the house until the sheriff showed up.
My dad lost my childhood home - he put it up as collateral for a business loan, and one of his business partners embezzled the hell out of the company. It also drained his superannuation and annihilated his life savings.
He ended up having to move in with his first ex-wife’s father for cheap rent, I had to move in with my mother until I could move out.
Some friends’ married daughter (stay at home mom) and family would have lost their home except my friends didn’t retire in order to pay the mortgage. They said they’d rather do that than have their daughter and family move in with them. SIL lost his job. What the SIL’s family did to support them, no idea.
I suspect this is quite common - the looming disaster is just easier to hide from than deal with, for whatever reason, maybe it’s shame, depression, embarrassment, fear. Who knows, really, everyone is different.
Maybe they’ve spent all their savings trying to keep the place, or there’s a much smaller income, or maybe somebody is ill and two incomes have become one , or someone’s applied for hundreds of jobs but can’t even get an interview and the house doesn’t fucking move to a different part of the country.
And they stay up all night because they dread the morning calls and the fateful knock on the door and the changing of the locks, and they can’t face deciding which bill to pay because they need heat and light and food, or maybe they just stick their head under the pillow or in a bottle to blot things out.
I knew someone back in Texas who lost his house that he had inherited through sheer stupidity. First he ran up a mountain of debt that he never should have in the first place. Then he was told by a supposed friend that the only way to save himself was to sell his house. Sell it to … the supposed friend! Which he did, at a hefty discount and against all advice to the contrary from everyone else and his brother, because he really trusted this Bozo. What can you do?
Looks like I’m the first one to speak first hand. This was me, about 3 years ago. My wife and I had bought the house I grew up in from my parents (after renting from them for a couple of years). The house was within our means, but just barely. We managed to pay the bills, take a couple Disney vacations, drove modest used cars, etc, etc.
Then my wife quite suddenly decides she doesn’t want to be married anymore and leaves. Although she willingly paid child support, just couldn’t make it work anymore. We were barely making it by with two incomes to throw at it, no way it was going to happen with just mine and a fraction of hers (I made a little more than her, but not by a lot).
First step… hardship withdrawal from my 401(k)…spoke to somebody at Fidelity who managed my funds but in order to qualify the house had to be in (the beginning of) the foreclosure process. So I strategically skipped 3 payments (used the money to pay down credit cards and pay off my car), only to find out that I was misinformed and couldn’t withdrawal money that way.
Next step… try to negotiate with bank. Called them, explained my story, filled out some paperwork for a modification, was told I’d hear back in a few weeks (was told by someone else to not make payments while waiting to hear cause the more desperate you look the better off). So finally hear back from bank… they are NOT willing to deal and at this point I am like 5 months behind. They do offer a payment plan that will stretch out those 5 payments over 6 months, but that would mean paying almost double payments and as I said I couldn’t even make one.
Third step… contacted a company specializing in getting modifications. Checked them out with BBB and everything. $2000 and they guaranteed a modification or my money back, supposedly they knew all the ins and outs of the paper work, what to do, what to say, blah blah blah. A couple months later, no modification, can’t get anyone on the phone… yup, scammed.
So now I’m 6+ months behind, ain’t know way I’m getting out from under at this point (remember also dealing with separation/divorce) so I start looking for a cheaper place to rent. Briefly consider moving me and 3 kids in with Mom and Dad, but not quite that desperate. At this point, figure there is no point in sending any more money to the mortgage company, as in the end I will still default and I might as well have dumped that money in a hole.
So I wait until I get kicked out. Actually, it took a while. The last payment I made was December 2009 and didn’t move out until April 2011. Bank just overwhelmed with foreclosures I guess. Actually only ended up moving out that April because I found the perfect place, so I wasn’t kicked out by the sheriff.
Just packed up and left, didn’t turn the key in to anybody (who would that have been?). Went back a couple times to stare wistfully (the house that built me and all that) so I know that the bank didn’t take possession or do anything to secure the house until December of that year, so I might have been able to stay longer.
Anyway, ended up filing bankruptcy and cleaned the whole slate. Credit took a hell of a hit, but better than getting buried under a mound of debt that I would LITERALLY never be able to pay off.
So yeah, it happens, and the people it happens to aren’t necessarily sitting around waiting for it. I tried to salvage what I could of a bad situation. Wife screwed me (for leaving and precipitating all this), the bank screwed me (by not offering a modification), that finance company screwed me (by taking my money and giving me NOTHING), so I try not to feel bad about living rent/mortgage free for a year and a half. It’s not like I’m some deadbeat who was out trying to game the system.
Not sure if I know anyone who’s been evicted from their home, but I do know someone who literally had their house taken away.
In high school, I had a friend whose parents put a manufactured home on some property they owned. The house was on the property for about two or three months and my friend’s family was living next to it in a trailer while everything was being set up.
Anyway, one morning I pulled up to give my friend a ride to school and the house was gone - nothing left but the hole for the basement. They had hauled it away a day or two before.
Not sure exactly what the situation was - I felt too bad for my friend to really press him on the issue. But the dad was perpetually unemployed, and always had financial problems, so I couldn’t say I was too surprised.
I’d say my house lost me, not the other way around.
I did everything right buying the place; I found a motivated seller who hadn’t even listed the home yet, I bought a cosmetically blemished home for a great discount, and I spent less than half of what the bank said I could afford. I got a regular 30 year fixed mortgage.
I also managed to buy at the very peak of the real estate bubble. After spending several years there it was quite disheartening to see all of my neighbors short selling for 40% of my mortgage balance or walking away.
The bank didn’t want to work with me, they wouldn’t modify or refinance my loan. Modifications and short sales are means tested and I acted too prudently to qualify. Refinancing requires equity.
I really needed a bigger place. Real estate was cheap as hell and I could afford a whole lot of home if not for the burden placed on me by my greatly devalued current home. I found a lender who didn’t care that I had every intention of screwing B of A. I stopped paying my mortgage and found a much nicer place for a lot less money and bought it. B of A foreclosed pretty quickly.
Now everyone has their own bedroom. I’m in a friendlier neighborhood. My mortgage payment is less than half what it was at the old place. I don’t have pristine credit anymore, but I can afford to pay cash for everything so it works out fine for me. The real estate market has really turned around since then and I have a lot of equity while the old place would still be underwater. It’s a moot point if the place is your home, but some day I’ll want to sell and retire and it’ll make a big difference then.
My brother lost his house. He was making decent money, and didn’t try to buy more than he could afford. But he didn’t have a fixed rate mortgage. When the bubble burst, his interest rate went through the roof, almost tripling his current mortgage payment. He simply couldn’t afford that much of an interest payment. The bank wouldn’t lower it to something reasonable, so he lost it.
Thanks to the OP for bringing it up (and to those who read my ridiculous long response).