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A new tactic for struggling homeowners
Old 10-04-2008, 11:43 AM   #1
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A new tactic for struggling homeowners

On Friday, a decision was made that incentivizes reckless behavior.

No, I'm not talking about the "bailout."

Fannie Mae forgives loan for woman who shot herself - CNN.com

Addie Polk, 90, of Akron, Ohio, became a symbol of the nation's home mortgage crisis when she was hospitalized after shooting herself at least twice in the upper body Wednesday afternoon.

On Friday, Fannie Mae spokesman Brian Faith said the mortgage association had decided to halt action against Polk and sign the property "outright" to her.

"We're going to forgive whatever outstanding balance she had on the loan and give her the house," Faith said. "Given the circumstances, we think it's appropriate."

--

I hope a 35-year-old man doesn't try this, though, as I suspect it only works for 90-year-old widows.
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Old 10-04-2008, 11:58 AM   #2
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I think the total borrowed was roughly (there was a HELOC also involved in this thing) $50,000. Now the question is, at lease in my mind, why did she borrow it? My cynical mind tells me it was to help (or at the behest of) a child or grandchild or some other family member. That is IMHO would be really bad. Her husband and her (he is deceased) purchased the place in 1970, paid for it completely, and then she takes the loans. There is more to this story than is hitting the wires.
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Old 10-04-2008, 12:00 PM   #3
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That story is heartbreaking.
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Old 10-04-2008, 12:17 PM   #4
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I got a papercut while writing a check to my mortgage company this month. Perhaps they'll forgive my debt.
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Old 10-04-2008, 12:35 PM   #5
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This is depressing to contemplate, but what are the odds we see someone intentionally shoot themselves to try to get out of a mortgage after reading this story?
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Old 10-04-2008, 12:42 PM   #6
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This is depressing to contemplate, but what are the odds we see someone intentionally shoot themselves to try to get out of a mortgage after reading this story?
Hopefully they will realize that you have to be a little old lady to make it work.
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Old 10-04-2008, 01:30 PM   #7
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How do you screw up shooting yourself.. twice in a row?
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Old 10-04-2008, 02:11 PM   #8
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I bet she wishes she would have taken out a larger LOAN! Only in America! I bet the stores will be sold out of ammunition by tomorrow afternoon.
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Old 10-04-2008, 03:01 PM   #9
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I'm guessing she either ran out of money or had to do some work to the home.
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Old 10-04-2008, 05:50 PM   #10
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I'm guessing she either ran out of money or had to do some work to the home.
If so, I wonder why she didn't take a reverse mortgage instead of just borrowing against the house. Whether she wanted the money for a family member (as suggested by OAG), living expenses, or repairs, couldn't she have used a reverse to get either a lump sum or periodic payments, or both, with no danger of foreclosure? Or do I misunderstand how a reverse mortgage works?
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Old 10-04-2008, 07:05 PM   #11
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Depends on the value (of the house). You don't get as much cash on a RM as you would think (about 40% of the value of the house is about it). Besides probably more red tape. Regardless, with exception of the wounds, it has worked out fine. However, I would not expect the city/county to let her go "home" - probably headed to a nursing home either voluntarily or by court order of some type (danger to herself).
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Old 10-04-2008, 07:24 PM   #12
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I hope a 35-year-old man doesn't try this, though, as I suspect it only works for 90-year-old widows.
I have heard of one or two that have tried it in Pittsburgh during the 1980's. Your right. Doesn't work for men. Especially steelworkers. I suspect that it will not work for autoworker or stock brokers either. So don't get any "ideas".

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Old 10-04-2008, 08:23 PM   #13
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How do you screw up shooting yourself.. twice in a row?
We had a guy here in town that had attempted to "off" himself several times....without success. He'd been institutionalized a few times for it.....I guess they thought he was nutz or something.

So last year he decided to blow-up his house with him in it. He turned off all the pilot lights and disconnected the gas line to the stove.....without turning off the gas! After a while he stuck a cigarette into his mouth....figuring it to be his last one.....and flicked his Bic.

He thoroughly succeeded in blowing his house to smithereens....totally leveling it! Except for one very small area.......right where he was standing. He received a few minor cuts and bruises, and 1st and 2nd degree burns to all of his exposed skin.

The only things that he really succeeded in doing were that he:
1) Caused himself some fair to midland pain....and lots of doctor & hospital bills.
2) Made himself homeless.
3) Lost and/or destroyed nearly all of his worldly possessions.
4) Got arrested for endangering the public.
5) Got himself sued by a guy that was driving down the street in front of his house.....several large pieces chunks of flying debris hit, and severely damaged the guy's new pickup truck.

I understand the theory of "if at first you don't succeed, try, try again", but at some point a guy's gotta step back and ponder finding a new 'hobby'.
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Old 10-04-2008, 08:26 PM   #14
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Sounds to me like the guy is going to keep trying until he succeeds - even if it kills him...
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Old 10-04-2008, 09:36 PM   #15
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Sounds to me like the guy is going to keep trying until he succeeds - even if it kills him...
Unfortunately he 'succeeded' accidentally a couple of months ago. He was supposed to meet someone for lunch or dinner, but didn't show. So they went to his house and found he had fallen down the basement stairs while attempting to carry his laundry upstairs. The friend said that the guy's attitude had changed drastically since his attempted suicide last year, and that he was much happier and more content with his life. The police said that there was no evidence that he was making another attempt. There was no note this time as there had been in the past, and he had talked to his friend shortly beforehand and seemed happy to be getting together with him.

Apparently this time he was just a victim of an unfortunate accident. And it's really too bad, because his friends said that he was really a great guy, but over the past few years, he had suffered from periods of deep depression, and some misfortunes in his life. But since the house explosion, he had been receiving professional help and treatment, and it appeared to have been helping.

It was really quite a sad situation.
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Old 10-05-2008, 07:05 AM   #16
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I read that story and was wondering what the mortgage company was thinking loaning someone that old money with a 30 year repayment term. The term was longer than her lifespan.

I wonder if I can just shoot up in the air or something to get my mortgage forgiven. Don't really feel like shooting myself over it...
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Old 10-05-2008, 08:58 AM   #17
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I read that story and was wondering what the mortgage company was thinking loaning someone that old money with a 30 year repayment term. The term was longer than her lifespan.
Can't discriminate based on age.
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Old 10-05-2008, 09:10 AM   #18
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Because they would have been a lienholder on the property and would have had the loan settled upon her demise, and they'd have been first in line so even if the home value plunged they'd still get their money back.
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Old 10-05-2008, 02:07 PM   #19
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I read that story and was wondering what the mortgage company was thinking loaning someone that old money with a 30 year repayment term. The term was longer than her lifespan.
My parents-in-law got a 30-year mortgage in their 70s. Not even a murmer from the mortgage company. Probably nine-tenths of their over-55 community is mortgaged or reverse-mortgaged.

Considering the remaining lifespan of that demographic, I think the mortgage banks would rather go through probate than foreclosure...
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Old 10-05-2008, 02:27 PM   #20
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To my knowledge the first lien holder gets the house up to the lien balance at the time of death. If it does not sell for the Lien balance the lender "eats the loss" (profit goes to the estate). No probate or foreclosure they just have to be careful to satisfy the sale at "arms length". Works if the borrower is just legal age or even 100 years old as long as they can qualify otherwise for the loan.
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