Monday, May 9, 2011

Comment on Clive's Column on Foreclosure

The woman in question is a neighbor of mine, a hard-working professional and a mother, who has been struggling to keep her home and renegotiate the terms of her mortgage for over a year. Like more than half the people who have bought homes in Worcester during the past ten years, she is "underwater", owing more than the current market value of her house, which severely limited her options.

The notice that was posted on her door and then mailed to her came just days after the auction. It was illegal, untrue - and terrifying. It is part of a pattern in this city of emptying buildings very rapidly after a foreclosure. Just weeks after an auction most of the owners and most of the tenants are gone. By law the banks are required to keep the tenants in foreclosed buildings on as tenants of the bank, but they scare or drive them away anyway.

And then ... the banks seal up the building and leave it standing empty to rot. Don't ask me why they do it, it doesn't make sense from any normal business perspective, but that's what they do!

This is not the world of Jimmy Stewart, although we still have wonderful local credit unions and banks that play fair and deserve our support. The mega-banks helped set up this crisis and the housing bubble that underlies it, made a fortune lending and on the side betting against the loans they were making, and are trying to stick us with the bill. In the process they triggered a world financial collapse that is starting to look more and more like a depression. And then they collected nearly a trillion dollars of our money to bail themselves out - which they paid back by borrowing many trillions at near zero interest to buy Fed notes at over 4%. Now they are trying to stick millions of their victims, like my neighbor, with the bill.

So what is the sense of trying to blame her for this? Some folk, it seems, just like kicking people when they're down.

But guess what? She's not staying down, she's fighting back now!
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