Popular Posts

Sunday, June 12, 2011

Meet The Squatters: Here Are The Millions Of Americans Who Live Mortgage-Free For Up To 5 Years And Counting

The topic of Americans living mortgage-free in foreclosed homes on which banks do not have proper titles is nothing new - in fact we are surprised that there isn't a robosignature app for that...yet. Neither is the fact that this ongoing reverse capital transfer provides as much as $50 billion in "rental" income [1]for those same squatters. And while the ethical arguments for strategically defaulting on one's mortgage can get very heated on both sides, one thing is certain: the ongoing foreclosure crisis is creating a new subclass of "entitled" people, who certainly enjoy living on the back of the banks, while not paying one cent, and not vacating the premises. According to a new article by CNNMoney [2], some of the excesses observed within this latest demonstration of unearned entitlement are truly staggering. To wit: "Charles and Jill Segal have not made a mortgage payment in nearly five years -- but they continue to live in their five-bedroom West Palm Beach, Fla. home....Lynn, from St. Petersburg, Fla., has been living without paying for three years....In Thousand Oaks, Calif., an actor has missed 30 payments, and still, he has not lost his home...." In other words, what were once isolated incidents are becoming an epidemic, and like it or not, are creating a massive capital shortfall in bank balance sheets (after all "assets" are supposed to generate cash in most cases), which will likely involve yet another broad taxpayer bailout of these same banks that now have no recourse to do much if anything to evict these same squatters who instead of paying their mortgage (or rent), prefer to purchase trinkets and gizmos. "Some 4.2 million mortgage borrowers are either seriously delinquent or have had their cases referred to lawyers to pursue foreclosure auctions, according to LPS Applied Analytics. Of those, two-thirds have made no payments at all for at least a year, and nearly one-third have gone more than two years."

The specifics, to anyone who has been following this festering issue which threatens to create even further class resentment, are well known:
These cases can go on and on. Nationwide, it takes an average of 565 days to foreclose on borrowers in default from their first missed payments to the final auction. In New York, the average is 800 days and in Florida, where the "robo-signing" issue is particularly combative, it's 807.

If they want to fight evictions hard, borrowers can remain in their homes even longer while their cases are being worked through.

The Segals have been doing that -- in court. They bought their home in 2003 with an adjustable rate mortgage. After a few years, their monthly payments tripled to $3,000, just as their home-inspection business was cratering.

The Segals want the bank to modify the mortgage so payments are affordable, and they think the court will agree that their lender put them into a toxic loan.
Surely, the Segals signed the dotted line under the gun:

More

3 comments:

  1. I don't like banks...U.S. taxpayers reached in their pockets to the tune of approx. $800,000,000,000 to bail them out of their poor (greedy) buisness practices, they are not even trying to help fix the probelm that they created.

    ReplyDelete
  2. Something is wrong with this picture. I am working 50 plus hours a week to keep my housepayments and utility bills/insurance up to date each month - even pay early some months but go without personal items each and every month. But yet there are those mentioned in this article proud to say they have not made a housepayment in years and still live in the house.

    ReplyDelete
  3. Why have an electon in 2012 Obama gots it in the bagJune 12, 2011 at 9:13 PM

    39 comment: there is nothing wrong with this picture but this is a tale of the future for Obama Care; everything is free; no work and those old white dudes will pay for their transgressions of slavery over 150 years ago!

    ReplyDelete

Note: Only a member of this blog may post a comment.