More foreclosures coming from "Extreme Makeover"?
Filed under: Debt, Real Estate, Recession
It seems like we're going to see a lot more headlines like the one yesterday on one of the homes fixed up on Extreme Makeover ending up at a foreclosure auction (dramatically on the steps of the local courthouse in Georgia). Maybe it's only logical, given the mission of the show to fix up houses for those who can't afford to do so on their own. Many of these people are going to end up in further trouble, unable to afford their up-sized dreams.
Free Money Finance is hot on the trial of two more houses featured on the show that may be in trouble: one in Maryland and one in Oregon. In both cases, the families just had too much house to maintain and couldn't keep up. Being on the show may have actually exacerbated their problems. But isn't that the whole gist of the mortgage crisis right now? Banks extended pie-in-the-sky loans to people they know couldn't afford them, then jacked up the rates after they sucked the people into buying houses.
Long-term care doesn't have to be dreary entertainment. My favorite example of this is a short documentary that was nominated for an Academy Award years ago, The Collector of Bedford Street. The film details the efforts of a West Village neighborhood in New York to set up a trust fund for a developmentally disabled adult to insure his future after his aged caretaker passes away. It's great human drama.
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Reader Comments (Page 1 of 2)
7-30-2008 @ 4:10PM
James McClung said...
So much for being Mr. Nice Guy. Too bad it was wasted on ungrateful people who had no trouble squandering it away.
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7-30-2008 @ 6:33PM
ron maier said...
fools are fools and thieves will always be thieves. in addition, these people took every advantage they could, at the expense of the rest of us.
lets give them another chance and build them a bigger homethan this one, so they can get another mortgage
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7-31-2008 @ 6:49AM
gimmea6 said...
A lesson on the darker side of liberalism. Good intentions aren't always enough in the real world.
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8-02-2008 @ 8:11AM
Beach Jumper 1 said...
I clearly remember at least two of the Extreme Makeover shows in which the family not only received a home makeover, but in which the show also paid off the mortgage. They should do that with every home makeover even if it means decreasing the extent of the makeover. That would leave the family which receives the home in a better position to be able to pay the property taxes, which obviously would be less with less of a makeover, and better able to keep up with routine maintenance which should also be less for the same reason.
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8-02-2008 @ 8:50AM
ParrotLady64 said...
Paying off the mortgage is a nice idea, but they can then turn around and take out another mortgage on the paid off property. I believe that may be what happened in the GA case.
8-02-2008 @ 10:46AM
suzi said...
the problem is that even with the mortgage paid off, these people go to the bank and mortgage this paid off house to have the cash, or start a doomed business. you cannot save people from themselves.
8-02-2008 @ 11:20AM
Nancy said...
If u read the story u would know that the people took out a mortgage for $450,000 to start a business and it fell through. The original mortgage was paid off. "EM" always pays off the mortgage. These people got themselves into this mess by taking out a new mortgage on the home.
8-02-2008 @ 8:25AM
Gary said...
Some of you are missing the point. Extreme makeover did pay off the mortgage, these people had a home free and clear but decided to take out $450,000 on the equity of the home and now they can't pay it back. Thats what happens when you give people something with no ability to handle finance. Its just like those lottery winners that cant seem to live within their means and end up bankrupt in a few years. Maybe Extreme makeover should put in a clause on the deed that keeps people from selling or borrowing on the home for, say 20 years. That would keep this from happening.
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8-02-2008 @ 8:36AM
rob said...
working for something gives people a sense of accomplishment. giving people something gives them a sense of entitlement. why would anyone be surprised that these people could not manage a lot of money when they could not manage a little bit of money? the last thing these people needed was a house valued at a half million dollars when they are still on a $60k salary. can't pay the taxes on that coin.
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8-02-2008 @ 9:09AM
Herkeng said...
This is a pretty sad deal and speaks volumes for the current mind set of a lot of my fellow citizens. The reason I say it is sad is because the family went thru a lot of heart ache prior to being selected for the make over. That is why they were selected in the first place. Now because of their ignorance in managing their finances they are loosing their home.
The Show paid off the mortgage, paid the taxes as well. They set up a higher education fund for the kids and gave the family $100,000 dollars. Sounds like a great deal? it was but...the Parents still had the same spending habits and financial skills that got them in trouble. This is why I think a lot of Americans are in the foreclosure crisis right now.
We Americans had/have the capability to go into debt way beyond our means to repay. To much house, too expensive of a car, and a unaffordable lifestyle add up to someone or some family being unable to make the notes. The old expression is "Having a Champaign & Caviar appetite on a Beer Budget."
Gary brings up a good point about making a 20 year clause on the deed, I agree with that. I also think that if the producers are going to set these people up like this, they should also send the Adults to a financial management course so they can have the skills to cope with their new wealth. At that point the family has to be responsible (like the rest of us) on how they manage their assets. IE: the ball will then be in their court. If they blow it, well that is their business.
Go back to the old adage, "If you give a man a fish, he'll eat for a day. If you teach a man to fish, he'll eat for life." The Harpers got a fish from the show but did were not taught how to fish.
Herkeng
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8-02-2008 @ 9:13AM
Grace said...
Extreme Home Makeover goes to far. A lot of people do not need a huge, fancy house with all the extra bells and whistles. Can't a basic house do, in case like the ones Habitat for Humanity builds?
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8-02-2008 @ 3:47PM
Jenn said...
I would have to agree with you. Why doesn't EM build smaller, more managable homes? These people don't have the financial savvy to manage that kind of an investment without skills.
EM should send the parents to some financial planning classes instead of DisneyWorld. They would learn valuable life lessons they could pass on to their children.
8-02-2008 @ 10:11AM
masslive said...
Darker side of liberalism? There's no "liberalism" here - in fact, this is just the kind of non-government effort that those on the right have been pushing for years. Maybe it's the darker side of charity. Stories like these will have a chilling effect on some people's willingness to help anyone in need.
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8-02-2008 @ 10:17AM
jOSE said...
What do expect from ghetto superstars, these people have no understanding where money comes from. This is what happends when you give welfare to people. This picture of these idiots should be on everyones refrigerator, to serve as a reminder, dont be like these fools, or you end up in delux goverment housing project with Tupac and Biggie.
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8-02-2008 @ 10:24AM
Lisa said...
Another issue is that, with these bigger, even paid off houses, the utility bills will skyrocket. Some of these people go from having a small three bedroom house to having a mansion where just the living room is bigger than the old house was. Imagine just heating or cooling that space.
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8-02-2008 @ 10:28AM
emme said...
Classic! And people are suprised that this happens? I've watched this show, the real truth is they are helping out people who didn't have the intelligence or means to do it for themselves to begin with. This show expects them to be grateful and appreciative of the help - when all the show is really doing is enabling these people to continue their lifestyle of misusing the public trust. I am sure some of the families are just temporarily down on their luck ( like the military families and the ones with disabled/sick children, but several of them have simply led a life where they squandered their money, been on public assistance or never worked - and that is what brought them to the shows attention in the first place. I have no sympathy for this foreclosure mess! I am a single, intelligent, responsible, law-abiding citizen teacher- that means no illegitimate children, worthless family members on my doorstep, never been in jail and have NEVER been eligible for public assistance, free money for school, or any other type of handout! Why can't I have my modest home remodled and paid for?????
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8-02-2008 @ 11:15AM
Sue said...
The families say up front they can't afford where they are living at the time then this TV show goes and builds them a bigger more expensive house with all these fancy gadgets that advertise all the great products the sponsors want to sell to other families.
So the family gets maybe 2 -3 years of living in heaven before they get to return to hell.
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8-02-2008 @ 11:23AM
ANNE said...
I don't think the houses should have a mortgage paid by the show. I sure wish someone would come and do something at my house and then pay my mortgage, I'd be a happy camper.
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8-02-2008 @ 11:57AM
David said...
They should be made to sign a legal agreement that they cannot get a new mortgage on their new house at all. I can't recall an episode when their existing mortgage was not paid off. They must agree to these terms or they get no makeover at all.
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8-02-2008 @ 11:57AM
DORFMONT said...
What gets these "winners" is the income tax due on the "Prizes and Awards" income they get in home improvement and mortgage relief. All of this is taxable income which has to have its taxes paid in cash. No wonder they have to remortgage the property to raise the cash for taxes. This is not as charitable gift from the production company. It is paid for by advertsing money from the sponsors.
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