A Foreclosure Story

Posted in Foreclosure Homes, August 29th, 2008 |

Today majority of American families have a foreclosure story to tell. This particular one was the story of a couple who were professionals in real estate business.
They couple lived in Orange County and earned a combined income of $1, 30,000 a year. With the setting in of the recession in the housing sector, the first downturn wedged into their pockets and their once high income began to dwindle. Following a second bout of declining prices the couple was required to clear the house, which was unfeasible because of the softening real estate market. They had to face a foreclosure.
The foreclosure story that circulated met with doubts and disbelief. Inhabitants outside Southern California sent mails with enquiries as to how a couple with an income as high as $1, 30, 000 sling into a foreclosure? It was an incredible story for a person in North Dakota as he was unaware of the effects of hyper-consumerism and the massive spending habits that the people of South California were used to. The websites bore testimony to the facts. The story was related to the previous month of the August credit event of the decade. Adding worries to woes the couple indulged in high-class living and had incurred huge debts that never gained support. “It was a Ponzi scheme” and went off track at the slightest bump.
As a follow-up of the foreclosure story, the detail of the financial condition was exhibited in the Los Angeles Real Estate Professional show. The shell of the matter was that the real estate professional couple made $1, 30, 000 in 2006 and expected to earn $40, 000 in 2007. The situation was a compelling one.
She had undergone a previous foreclosure of a rental home due to tenants going through a divorce; there were three mortgages on primary residence; mortgage no.1 $1, 700 a month, mortgage no.2 $600 a month and mortgage no.3 $ 440 for setting up an additional pool; all these figures were simply unsupportable. The $401K savings that they had were, under the circumstances being utilized to stay afloat and now she was a single mother trying to support her kids. She owed on her home$6, 00,000 and had estimated the value of her property to be $550,000. She was a real estate professional and expected to find a job with a six-figure tag.
Unfortunately she was unaware that market conditions would never be the same again.