Losing grip on home
Calls just keep coming for mortgage counselor
By David Slade
Getting help
Mortgage delinquency and default resolution counseling resources in the greater Charleston area that are certified by the U.S. Department of Housing and Urban Development:
-- Trident United Way: 843-740-9000, ext. 233. www.tuw.org
-- Family Services: 843-744-1348. familyserviceschassc.com
-- Neighborhood Assistance Corp. of America: 843-556-0497. www.naca.com
Previous Story
Several agencies offer help; Foreclosures often can be avoided, published 2/17/08
In 30 years as a mortgage counselor, Robert Mitchell has seen a lot of pain, but never like this.
Every day now, Mitchell gets dozens of calls at his United Way office from people who are barely getting by, and are desperate for help as they try to avoid foreclosure.
"People are trying to cut back on everything," he said. "Utilities, groceries; they are glad gas prices are going down."
Before the housing market and the economy went into a tailspin, Mitchell could get a handful of calls each day.
"You might have a foreclosure here or there because someone had a sickness or something," he said.
Now, a slow day is about 30 calls. A busy day can bring 50.
"When it started, it was mostly people with sub-prime loans," said Mitchell. "Now, about half are people who have lost jobs, or had cutbacks."
South Carolina's unemployment rate stands at 8.4 percent, the third highest in the country, and the state's economic advisers have estimated the jobless rate could rise to an unprecedented 14 percent next year, which would mean about 300,000 people out of work.
Employers across the state and throughout the greater Charleston area have been announcing layoffs, plant closings, employee buyouts and unpaid furloughs. Seasonal employers, like retail stores, meanwhile hired far fewer people this holiday season than in previous years.
Mitchell's office in North Charleston takes calls for help from people throughout the greater Charleston area, and from a larger area that stretches to Myrtle Beach, Florence and Hilton Head. Often, the callers are several payments behind on their mortgages and can't catch up without a loan modification.
"I had a homeowner who called last week who has had her home for 16 years," Mitchell said. "Her husband got laid off, she's sick and can't work, so they are in danger of losing their home."
Interest rates on 30-year fixed-rate mortgages have fallen to record lows, averaging just over 5 percent, but the opportunity to save money with a traditional bank refinancing is an opportunity mostly limited to those with jobs, good credit, and some home equity.
"It's a call to action for homeowners looking to get out of adjustable-rate mortgages," said Greg McBride, senior financial analyst at Bankrate.com. "Unfortunately, it's not an equal-opportunity party."
Mitchell said he frequently counsels people who are paying interest rates of close to 10 percent on their mortgages.
Often, he said, they are in a Catch-22 situation, where they cannot afford the mortgage payments and either owe more than their home is now likely worth, or they have equity in their home but can't find a buyer.
In November there were more than 10,000 homes for sale in the greater Charleston area, but only 435 homes were sold, the lowest monthly sales figure since the Charleston Trident Association of Realtors began keeping such records in 2003.
One bright spot for those having trouble paying a mortgage, Mitchell said, is a government-sponsored reverse-mortgage program that allows people to stay in their homes, put their mortgage payments on hold, and even borrow against their home equity on favorable terms. The catch is, the program is only for people at least 62 years old who have substantial equity in their homes, usually at least 60 percent of the home's value.
For the rest, Mitchell said there are plenty of government programs, but those programs leave the decisions in the hands of the lenders.
"The people I talk to feel the federal government has bailed out the mortgage lenders, but the mortgage lenders won't help them," he said. "They made these loans to people, who sometimes weren't credit-worthy to start with, so they should work with them."
The Associated Press contributed to this report.
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Comments
BillytheKid (anonymous) says...
I learn every day at 60, I have not seen anything like this. A lot of us think we are safe because we have a small cushion, but for this we need a big cushion. Loans need to be fair, the reason for the load needs to be fair and problem solving needs to easy.
December 27, 2008 at 1:36 a.m. ( permalink | suggest removal )
Deborrah (anonymous) says...
Greed is the reason for the state of economy. The government should loan taxpayers $25,000.It would get the economy moving. The creation of green jobs should be icing on the cake.
December 27, 2008 at 5:31 a.m. ( permalink | suggest removal )
WhoCares (anonymous) says...
What idiotic statements!!! It doesn't take a genius to know that sub-prime mortgage holders DO NOT vote republican.
December 27, 2008 at 8:12 a.m. ( permalink | suggest removal )
MP (anonymous) says...
Jim Islander, you are totally full of crap. This started long before Bush. For generations the rule in lending was that no more than 28% of a family's income should go towards a home- loan principal, interest, taxes, and insurance. In addition, no more that 36% should go towards all debt- home, credit cards, car loans, whatever. People started buying homes beyond their means, financing 100% because they could get a variable rate or adjustable rate loan with a low initial interest rate. Unregulated mortgage brokers, not banks were making these loans. Then, when the house went up in value they ran out and got an equity loan to buy that Lexus or SUV. No one made them buy the house, no one made them borrow more than they should. But, using your logic, its everybody's fault but theirs. Blame everybody but yourself for the problems you created, that's your philosophy, and exactly what is wrong with everything right now.
December 27, 2008 at 8:32 a.m. ( permalink | suggest removal )
dawhetsell (anonymous) says...
There has never been an "Unfortunately, it's not an equal-opportunity party.". The crap started with Jimmy Carter ( use to be the worse President ever )who though everyone should have the American dream( own a Home ). He started a program to get as many sub-prime loans ( loans to people with no credit,bad credit,no jobs,on welfare and counting welfare and food stamps as income) as he could force down banks throats. I did not work very well as banks had to keep their loans. The the goverment decided to repeal the law ( passed in 1933 )that banks COULD NOT SELL STOCKS,BONDS and SECURITIES because that is what caused the DEPRESSION in 1929. Thegoverment let banks sell their loans again,the greed kicked in when Clinton took the Attorney Genrals office and people like oboma with acron threaten banks with discrimation if they didn't loan unqualified people home loans. Then the fed lower the intrest rate to 2%and the rules changed on home loan,credit cards, auto loans and every other kind of loan. Now history has repeated itself and this time there is no recovery. The economy will totally collapse into soicalism and a country withhout manufactoring is a third world country. MERRY CHIRISTAS EVEVYONE
December 27, 2008 at 9:03 a.m. ( permalink | suggest removal )
MP (anonymous) says...
Once again, JimIslander, you prove stupidity is to the bone. There has been NO major deregulation of the banking industry as far as mortgage lending is concerned. The same laws exist that were created in the late 70's under Jimmuh "lets all get along" Carter". That is also the time when interest rates on deposits were deregulated causing the closure of almost 2,300 banks. What were mortgage rates under Jimmuh- 15% to 18%. What are they now 5% to 6%. And, there never has been any significant regulation of the mortgage broker industry by anyone.
Yes, Bush has not been good for our country. His last approval rating was 28%. BUT what is congress' approval rating? 16%. Bush's is twice as good.
Dude, you really need to get some counseling for your delusional paranoia. You are one sick puppy.
December 27, 2008 at 9:25 a.m. ( permalink | suggest removal )
willx45x (anonymous) says...
Hey Jim Islander - you are a moron. None of this debacle would have been possible without Fannie and Freddie - the two Democratic love-children who encouraged all of this ridiculous lending buy purchasing the loans and removing the risk from the banks' balance sheets. Barney Frank is far more to blame than "W". Bush had nothing, nada, zilch to do with this crisis. I realize stupid people enjoy blaming Bush for everything, but such blanket generalizations don't stand up to scrutiny. You are truly a dummy.
December 27, 2008 at 9:57 a.m. ( permalink | suggest removal )
mkris (anonymous) says...
Hate to break it to you.... the republican love child, Ronald Reagan started the banking deregulation train -- not Carter. The Glass Stegal Act and the 1933 Banking Act were repealed by a REPUBLICAN congress that presented Bush 41 and then Clinton with a veto proof majority and the treat that none of the presidents' political adgenda would be passed UNLESS they signed!
Sub-prime mortgage and no doc loans were the resulting consequence of the need for commercial banks to compete with investment banks for profit and tranching of the securitized mortgages.
December 27, 2008 at 10:33 a.m. ( permalink | suggest removal )
jsteph10 (anonymous) says...
I thought that liberals were the folks that were compassionate, loving, and cared for their fellow man.
Mr. Islander, turn off the MSNBC and Air America and get outside to get some fresh air. Hopefully it will blow away all the talking points and anger that have built up inside of you.
December 27, 2008 at 10:41 a.m. ( permalink | suggest removal )
geekboy (anonymous) says...
Please do not feed the pathetic troll.
December 27, 2008 at 11:23 a.m. ( permalink | suggest removal )
yird (anonymous) says...
jsteph10;"Mr.Islander, turn off the MSNBC and Air America and get outside to get some fresh air. Hopefully it will blow away all the talking points and anger that have built up inside of you."
=======================================
Choose your words carefully when responding to the troll. You'll get him all lathered up and distracted and he won't be able to share his concise logical thoughts with the rest of us.
Jimmie, holier than thou Carter, Barney, fruitcake Frank, and Chris, slimball Dodd, should all be tarred and feathered and run out of town on a rail for the evil they have perpetrated against the people of this nation.
December 27, 2008 at 11:38 a.m. ( permalink | suggest removal )
nappyd (anonymous) says...
Pretty annoying to see this huge problem in hindsight and not even know who or where to place the blame b/c it is such a big problem caused by both parties and that there isn't an easy answer.
But basically yeah, it does come back to greed, deregulation, and a cheapened dollar. While Bush could/should have monitored all that closely, it's hard to do when he's getting bad info from people in charge of their appropriate agencies, such as Paulson, Bernanke, etc.
Oh, and before blaming presidents/parties for the mess, don't forget Greenspan, who lowered rates that led to the housing bubble and fought so hard against regulation of the derivatives market which, in turn, led to us all owning some small % of large banks & brokerages that gave out 6 and 7 figure Christmas bonuses for not making money this past year.
December 27, 2008 at 12:41 p.m. ( permalink | suggest removal )
FiscalConservative (anonymous) says...
There needs to be deregulation of the financial industry. The more regulated the industry gets the more creative the people become to skirt the regulations. What we need is exponentially harsher penalties for outright fraud and theft by people who purposefully deceive investors (Madolf,etc.) I would argue for the death penalty. For companies who make bad investment choices and collapse, they should fail. No government bailouts or subsidies for anyone. The free market will work. But not with the gov't picking winners and losers.
December 27, 2008 at 1:49 p.m. ( permalink | suggest removal )
FiscalConservative (anonymous) says...
One more thought. Bush is not a republican. During his tenure we have seen an amazing expansion of the federal government. Last time I looked that was a democratic principle. We need to scale back our central government, cut social programs, cut taxes, make bigger tax incentives for giving to charities, and free up trade. When countries are interdependent on one another for goods and services they will be less likely to fight.
Free markets work.
Google "negative railroad"
And for "creation of green jobs"--
Google "broken window fallacy"
General Knowledge---Herbert Spencer "Social Statics"
http://oll.libertyfund.org/?option=co...
December 27, 2008 at 2:11 p.m. ( permalink | suggest removal )
flyingopinion (anonymous) says...
What happened to personal accountability? Is that a lost concept? No one forced people to sign on mortgages they can not afford. People need to face the consequences of their choices. The sub-prime mortgages started back with the Community Reinvestment act of the Clinton era. Regardless of political party, everyone has a piece of the blame. The politicians used it to gain power, people took advantage to get into houses they couldn't afford. But, amazingly we keep re-electing the same people. With the soon to be regime change in Washington, don't expect anything different. They just want political power and politicians have learned they the can cause a problem and then swoop in and save the day (of the problem they created) and we keep bowing to them at the voter box! People need to grow up and take care of themselves!
December 27, 2008 at 2:17 p.m. ( permalink | suggest removal )
mkris (anonymous) says...
Keep drinking the republican deregulation Kool-Aid!
The community reinvestment act had minimal effect on the subprime mortgage securitization and the derivative market mess. It goes right back to the republican Congress under Reagan, Bush 41, Gingrich and Graham. It was the repeal by Grahm Leach (R) and the elimination of any distinction between investment and commercial banking! Regulation has a place in the market.
December 27, 2008 at 3:39 p.m. ( permalink | suggest removal )
buzzinlikealdrin (anonymous) says...
Term limits is the answer. We need to flush this toilet. ALL of them.
December 27, 2008 at 5:41 p.m. ( permalink | suggest removal )
B_Fwank (anonymous) says...
LOL, you are such an idiot jimbo the clown. You are the only racist here. This article has nothing to do with race issues.
You are a sick and deluded punk at best.
Get a life you gutter troll. You are a very dangerous, nut case at worse.
Either way, you are in two words - pathetic and irrelevent.
So go play with your little Obama half white half black blow up doll and have a wonderful day in your sick and demented world.
December 28, 2008 at 9:34 a.m. ( permalink | suggest removal )
JohnS (anonymous) says...
Many people were put into houses they had no business in them in the first place. Mort brokers and banks should have been making loans the old way. Require them to put a down payment into the loan. These no doc loans and these 125% loans along with an adjustable rate finally caught up to these folks. I don't feel sorry for them. Go rent an apt. I also hope many of these developers/real estate agents go out of business. Many of these new homes built in the last few years around here were over appraised.
December 28, 2008 at 9:36 a.m. ( permalink | suggest removal )
yird (anonymous) says...
JohnS; Comments like yours will stoke the ire of the nice people and you'll probably be advised to get sensitivity training.
Not only are the homes(as you pointed out)over appraised but they are also shoddily built, plastic replacing wood at every opportunity.
Down payment? Isn't that cruel and unusual punishment?
December 28, 2008 at 10:46 a.m. ( permalink | suggest removal )
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