I offer the following article as an example of what will soon happen in
every city and suburb in the US. As Oil prices increase the cost of
energy will wreck the economy, people will be out of work and unable to
pay rent and house payments. That will cause a spiral of economic
collapse. Famine and riot will follow.
[found on the 'net]
WELCOME TO STOCKTON: FORECLOSURE CAPITAL USA
by Zachary Slobig Thu Sep 13, 9:20 AM ET
STOCKTON, United States (AFP) - A town in central California has become
ground zero in the wave of foreclosures plaguing the US housing market
in the wake of the sub-prime lending crisis.
With a population of nearly 300,000, Stockton has acquired the
unfortunate distinction of having the highest foreclosure rate of any US
city, with one in 27 households left counting the cost of the credit
crunch, according to Realtytrac, an online marketplace for foreclosure
sales.
Stockton's Weston Ranch neighborhood, a 15-year-old subdivision of
modest tract homes, has the worst foreclosure rate in the area,
according to ACORN, a national advocacy group for low and
moderate-income families.
"It's not the CEO of Intel who lives in Weston Ranch, but the guy who
details his car," Geri Taylor, broker at Weston Ranch Realty for twelve
years told AFP. "They just were not prepared for this."
Adjustable rate mortgages offered to sub-prime borrowers, hopeful
homeowners with shaky credit, lured families into houses with inflated
prices, said Taylor.
"Many financed one hundred percent of the price, and some even financed
the closing costs," she said. "They got in at a teaser rate thinking
this neighborhood would be commutable and affordable, and then the rates
went up."
Sign-after-sign beckon to potential buyers on the Weston Ranch streets.
"American Dream Realty -- Reduced Price!" reads one placard spiked into
a brown lawn.
"People are just walking away," said Taylor. "We've seen houses with
food still on the table from when the sheriffs have come knocking."
Lupe Dominguez washed his car in his driveway two doors down from a
shabby bungalow with a front window covered in a yellow and black poster
announcing a public auction with a fifty thousand dollar starting bid.
"That house has been empty for nine months or so and the sign has been
there for two," he said.
A friend who lived down the street lost his house to foreclosure and
then rented a house that he had to vacate because it too was foreclosed,
he said.
Gloria Johnson, another broker in the Weston Ranch area, has increased
her volume of "short sales," as a method to help homeowners avoid
foreclosure and wrecked credit.
In this arrangement, the borrower provides evidence of financial
hardship and the lender agrees to assume a loss and sell the house below
the amount owed on the mortgage.
"It is almost like begging, but I am doing everything I can to help
these people maintain their dignity," she said.
Taylor too has modified her business practices, shifting her focus from
home sales to rental property management, advising clients to wait out
the market. She manages fifty rental homes now, properties that she
hopes to sell for clients when buyer interest returns.
"There are just are no buyers out there right now," said Taylor.
Houses are sitting on the market three times as long as in 2006 and the
average sale price has dropped by 10 percent, she said.
"We've got 350 homes for sale in this neighborhood right now and at this
rate, that is five years of inventory," said Taylor.
"Nobody has a crystal ball, but I don't expect to see an improvement
until 2010."
Potential homeowners must be better educated about the market, said
Lance Hill, a housing counselor with Visionary Homebuilders, a Stockton
non-profit whose goal is to extend homeownership to low-income families.
"To be mortgage ready, they need to know what adjustable rates,
refinancing, and pre-payment penalties mean, and we must make sure that
they have a certain education level," he said.
Stockton has had 8,000 foreclosures so far in 2007.
"Home ownership is a great thing," said Taylor, "But only if you can
afford it."
[endit]
Are you watching the signs, or are you closing your eyes?
Glenn
His witness
--
www.thelittlebookopened.org [Key words:] "The Little Book";
Glenn McClary, servitum, gaedhealic, oldwetdog
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