Habitat homes going on auction block
Families left last year, neighbors said
Eight years ago, Sandra Simmons stood on H Street and watched out-of-state college students and local volunteers build her new home on land the city donated to Charleston Habitat for Humanity.
Today, the modest house where Simmons lived with her six children is scheduled to be auctioned to the highest bidder in front of the Charleston County Judicial Center in a foreclosure sale.
Also slated for auction is the house next door, 13 H St., where Habitat has foreclosed on another client, Undrea Sanders.
Charleston Habitat for Humanity Executive Director Jeremy Browning said it's uncommon for the nonprofit housing group to foreclose on a client, and even more unusual to foreclose on two at once.
"They could turn up today and I would negotiate with them, but I doubt that will happen," he said.
Browning said it appears the neighbors separately abandoned their properties more than six months ago after falling behind on payments. The doors and windows of the properties have been boarded up, possibly by neighbors.
"Some time in the early fall of last year, we heard from the neighbors that the houses were empty," Browning said. "I have absolutely no idea where these two families are."
Across the nation, a large spike in foreclosures has been blamed on adjustable-rate mortgages, loose lending practices and buyers who got in over their heads. But Habitat homes are charitable endeavors, where owners are given modest, no-interest loans.
Mortgage payments are typically between $350 and $450 a month, just enough to cover building materials and payments to subcontractors such as electricians. Homeowners also must pay property taxes, utilities and insurance.
Habitat maintains a second mortgage, to keep homeowners from flipping the properties or borrowing heavily against the house, but that mortgage is forgiven over time and the rest comes due only if the house is sold.
"It's a shame," said Larry Cohen, attorney for the nonprofit group in the foreclosure cases. "They will go to the highest bidder."
Browning said that Habitat would only bid up to the amount owed, which is around $70,000 on each house, representing the first and second mortgages. He said he hopes someone bids more, because Habitat would rather have the money than the properties, which he expects would need to be rehabilitated.
Browning said volunteers want to build new homes for the needy, not repair old ones.
"It's not a very sexy project to take a sponsor to," he said.
Reach David Slade at 937-5552 or dslade@postandcourier.com.
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Comments
This article has 6 comment(s)
Posted by eyfigueroa on May 6, 2008 at 9:04 a.m. (Suggest removal)
Though the premise of this organization is admirable, these families need rehabilitation themselves before they are put into these homes.
Some of these families are used to living on the public dole and even when they do garner better paying jobs it is difficult for them to shake the welfare mentality. Many of these same people do not understand the concept of budgeting and saving. They've learned to live hand to mouth for most of their lives and even when given opportunities to better their station in life, find the process too overwhelming to navigate.
It is my understanding that Habitat families must go through first time homeowners & financial management classes. Perhaps that is not enough.
I don't have the answers but it would be great if a more stringent screening process was implemented. Perhaps some additional follow-up for the first 3 years would also help these new homeowners avoid the pitfalls of reverting back to their old financial ways.
One good thing about Habitat, apparently the foreclosure/default rate is far lower than the general population and hopefully these two families will remain the anomaly and not become the norm.
I would hate to see the irresponsibility of a few to detract from all of the good that Habitat For Humanity has done throughout this nation.
Posted by ashleyatwork on May 6, 2008 at 10:04 a.m. (Suggest removal)
Why does "Habitat" not just take back the homes that are not paid for and put another "client" in it and start the "mortgage" over for that client. There was no bank or lender to make the original loan right?
Posted by JohnS on May 6, 2008 at 10:53 a.m. (Suggest removal)
Maybe Trademark can use this house on the show. Buy it fix it up and flip it.
Posted by eyfigueroa on May 6, 2008 at 11:03 a.m. (Suggest removal)
archdude: you're correct. it shouldn't be Habitat's mission to follow up on families years down the road. But a little extra effort on the front end i.e. tightening of the screening process, may stave off future problems.
However, no one can predict what people of any circumstance will do regarding their financial future.
Just look at what so many so-called middle class people are going through with the record number of forclosures.
Posted by bkeelin on May 6, 2008 at 11:07 a.m. (Suggest removal)
Habitat does go through a screening process, a budgeting class, and several other classes on credit, and other things to give people the best possible chance for success. This is the first I have ever heard about a Habitat home being forclosed on. I have not heard of any other forclosures in the tri-county area in the 20 years I've been here.
Posted by AHLeland on May 6, 2008 at 11:29 a.m. (Suggest removal)
If you'll notice, it says the house was built 8 years ago. This means this woman and her family managed to live in the house for at least 7 years. I don't think we can say a lack of screening or financial training had anything to do with this one.