Special Report: "Facing Foreclosure" Part 1
A recent report shows more than half of employed Americans are living paycheck to paycheck.
The predicament leaves many fighting to keep a roof over their heads.
In our special report, Facing Foreclosure, Eyewitness News Reporter Lanetra Bennett talks with a local family who knows first-hand just how tough that fight can be.
Annie Houston says she just had to tell the creditors straight up:
She said, "She did tell me, well, I guess I'll go on and foreclose it. I said, ma'am, do what you got to do because right now I'm not able."
Because she's not able, she and her daughter are facing foreclosure.
Fifteen years ago, Houston co-signed to buy a mobile home for her daughter--who does not want to be identified.
Houston's daughter said, "You have these people calling you constantly, all day, every day: where's my money? Where's my money? I want my money. Pack up, pack up. They have told me several times to just pack my stuff and get out."
Houston's daughter says two years ago her full-time job was cut down to only four hours a day.
She says in 2009, she missed two mortgage payments back to back, then about eight months later, missed a third payment.
The daughter said, "They have made so many threats until it's ridiculous, even to my mom. Oh, you better have the money. Oh, you better send us what you got. We don't care if you're on a fixed income. We want our money. That's the most hurtful part."
The Homeowners Preservation Foundation says 50 percent of homeowners are already at the point where they've missed two payments, leaving thousands of families trying to keep a roof over their heads.
RealtyTrac says the number of new foreclosures nationwide went up six and a half percent, from more than 225,000 in February, to nearly 240,000 new foreclosures in March.
In the first quarter of 2011, RealtyTrac says Florida had 58,000 foreclosures, with more than 1,200 in Leon County.
The report says there were more than 37,000 in Georgia, with 233 in Thomas County and 256 in Lowndes County.
Realtor Matt Hale said, "There's nothing to be embarrassed about. There's only so much you can do. If you don't have a job, you don't have a job. You don't have much option there."
Houston's daughter says she's since been making regular on-time payments.
She said, "Then they added interest for those three months. They keep adding interest because it's late and it hasn't been paid."
She says the interest is making it impossible for her to catch up.
"They accrued $9,000 or $10,000 interest. L4b I had no idea about the interest being compounded daily and that's adding up like that. The trailer is 15 years old. I know I've paid over 30-something thousand dollars. They said, it was like $36,000 more. So, in the end, when I get finished paying for this, it'll be like almost $70,000 for a double-wide. Now, that's just ridiculous. It's just too much to pay that much for a trailer."
Houston said, "If I see this trailer go, I probably would cry just to see it go because it's been here so long. That's one thing that would hurt. I never had to give up nothing. If this trailer have to go, it really would hurt real bad."
Exactly what do you do when you're facing foreclosure? Our special report continues Friday, May 13th, with a look at should you or could you stay, and what happens if you don't.
Special Report: "Facing Foreclosure" Part 2
The Mortgage Bankers Association says every three months, 250,000 new families enter into foreclosure.
Packed boxes fill the house.
One Tallahassee man--who wants to remain anonymous--has received a final foreclosure notice.
He, his wife, and their two small kids were given 30 days to move out.
He said, "We've started selling our possessions. You can look in the kitchen, we don't have a refrigerator. We sold that. We sold the stove. We sold the dishwasher. We sold the television."
The man says he was laid off from his job, got another job making two-thirds less, then was laid off again.
Losing his home was the resulting blow.
He said, "The five stages of grieving--denial, anger. Yeah, I went through all of them and you end up with acceptance. the acceptance is, I'll be leaving."
Realtor Matt Hale says the first thing to do when facing foreclosure is to take the emotion out of it and deal with the problem.
Hale said, "There's some people who want to put their head in the sand and hope it goes away. Well, eventually it will. It will go away one way or another. But, it may not be the way you want it to go way."
Hale says think it through, treat it like a business decision.
He says if hanging on to your property is the way you want to go, then call the bank, they'll feel better knowing you are trying.
The bank may even be able to work out some kind of payment arrangement.
The man said, "The response at that time was, plan is, pay your mortgage."
Hale said, "The only thing I'll caution you about talking to your bank: they're a hostile third party. So, if you're getting advise from them, it'd be like getting advise from the guy who's suing you. It may not be in your best interest."
In compliance with a Florida Supreme Court administrative order... once a foreclosure complaint is filed, a judge can assign the homeowner to a mediation program.
In Leon County, the Tallahassee Bar Association teams up with the Tallahassee Lender's Consortium to provide financial counseling.
Two hours is allotted for mediation so the homeowner and a bank representative can come together to hopefully reach an agreement.
Kathy Maus,Tallahassee Bar Association President, said, "We have found that it's very helpful for those that participate. Sometimes it's difficult to locate some of the borrowers and/or they're non-responsive and therefore they don't get the benefit of that program. But, for those who do respond, we have had many, many satisfied customers and many people that we've been able to assist in keeping their home."
However - Hale says sometimes foreclosure may be the best option.
But, it's possible that you you could still owe money.
He says while deficiency is waived in some states, Florida can come after you.
The man said, "The next 20 years, you're wondering, is somebody going to come knocking on the door? When does it end? When does it end? Is it not enough to have paid on a house for 15 years and then lose it?"
Hale says it's up to the bank whether you'll still owe; and he advises homeowners to get specific language on their particular case.
Another thing to keep track of in moving forward is your credit.
Hale says a foreclosure could damage your credit by 250 points.
Hale said, "The foreclosure itself, it's really hard to measure exactly what it's done because you've already got a 30 day late, a 60 day late, a 90 day late. The damage is done. You can't unring the bell on your credit. It's already happened."