Fighting foreclosures in Nevada

Of course, the jobs crisis goes hand-in-hand with the housing crisis. Many economists believe you can’t solve one without fixing the other. There is no place where that is more apparent than in Nevada, scene of this weekend’s Republican presidential caucus.

Nevada has higher unemployment than any other state – and, probably not coincidentally, has had the highest foreclosure rate for five years. Last fall, the Republican frontrunner, Mitt Romney told a Las Vegas newspaper: “Don’t try to stop the foreclosure process. Let it run its course and hit the bottom.”

The Obama administration has taken a more activist approach, proposing a series of steps to try to limit foreclosures. But how well have they worked?

Recently, with the help of our partner, ProPublica, Need to Know traveled to Las Vegas to see if the administration’s initiatives have helped keep people in their homes.

Megan Thompson reports.

Related:

The foreclosure crisis [ProPublica]
Big fish, little fish‘: Why the executives behind the financial crisis aren’t facing jail time

 

Comments

  • Joan

    I’m supposed to sympathize with a woman who had a $135,000 salary and a $600,000 mortgage. Please…  Hopefully she’s learned to live below her means.

  • Hannaorchids

    Are we really supposed to have sympathy for the “poor home owner” with the $600,000 mortgage?  This is an insult to the true working-class in this country.  The mentality of this person with the McMansion sums of the fantasy world that some people have been living in.  This is just another report from the asylum.  No wonder this country is in such trouble.  Wake up people!  Live within your means!!

  • H2rick

    Regulations should require that no borrower who is making less money than they were when they took out the loan should be eligible for a mortgage rewrite. Their problem is not caused by the banking system or the “housing crises” It is caused by the lack of jobs a different issue. This would make far more mortgage modifications available quickly to families who still earn the same amount but can’t keep up with an unscrupulous variable or adjustable rate loan product. By the way,being “under water” is irrelevant because a family with the same income that still needs a place to live pays the same monthly payment and keeps its home. Only families who irresponsibly expected a steady stream of refinacings to pay not for housing but short term luxuries t like cars and all sports channel cable and boats etc are adversely affected by the value of their house. If a family does not sell or refinance being über water is irrelevant. If death divirce or job relocation forces the need for refinancing then those discreet situations should be exceptions the the general rule that same-income

  • Beancounter

    Government has conscientiously avoided addressing the real problem.  Mortgage servicers get a windfall processing each foreclosure.  They double-track the delinquent into foreclosure so they can charge the mortgage owner for their marked-up cost of administering the vacant house and exorbitant foreclosure service fees.  The resulting loss of principle is the mortgage owners risk, along with the final selling costs and more fees.

    What a coincidence that the victims are the former homeowners and the investors who bought the mortgages.  And the beneficiaries are the banks that originated and sold the fraudulent mortgages then serviced the loans, and the politicians who receive their campaign contributions and write law and regulations that enable the business model. 

    It may make sense to modify mortgages to worthy homeowners facing temporary financial difficulty, but there’s no money in it for the servicer banks — and that’s what matters. 

  • jan

    Questions I am asking myself.

    When did people forget that most of these people were employed and able to make the payments, sometimes for years, until either they or a spouse or they both lost their job (outsourced or just plain laid off through the “lean, mean” ideology) or until they went through a divorce or when a spouse or partner died?  And are they also overlooking the fact that it could happen to them or are they attacking those to whom it has happened in the hopes that it won’t happen to them? 

    How long did it take people to forget the robo-signing foreclosure scandal, past, and if what I’ve seen is correct, apparently present and most likely future?

    Have the PR companies trained us that well to respond as desired? 

  • joan

    No, most of us haven’t forgotten. What we don’t want to believe is that there is not, and never was, an American dream for most people. Your responsibility is to protect yourself and yours by not acting out the fantasy of an American dream. Most people can and do lose jobs. If the loss of a job in the family is going to put your home in jeopardy then you shouldn’t have that particular home. I am as left wing as you can get and want to see people protected from loss but while I wait for paradise I protect myself from the hard sell. The hucksters don’t mean us any good.  

  • Concerned “American” American

    ..and I am suppose to have some sympathy for a woman who thinks she can afford an $800,000 house on a salary of $125,000 a year…give me a break.  If Need To Know wants to do a useful service to its viewers it will do a program on the idiosy and stupidity of entering into a mortgage like this woman had.  The dumbing down of America has never been more evident than in the housing/mortgage debacle of the past decade!

  • jan

    IF you really are left wing, Joan, you’re either wealthy or you don’t understand that they could (I repeat, they could afford the house when they bought it. 

  • Honsingerp

    I hate to be cold, but you spoke with Mrs Martinez in Las Vegas who was looking to the government to save her house from foreclosure, for which you mentioned she bought a  $600,000 mortagage.  This was a 4000 square foot house! 
    I make about her salary and have made it for the last 13 years.  My home is just under 2000 sq ft and I share it with two teenagers and my wife.  We took out a mortgage of less than half of what Mrs. Martinez took out.  I’m all for the govt stepping in for the middle and lower classes, but to keep people in their mansions?  This was too much home for anyone with such a salary.  I think you need to clarify where part of the problem lies: people were sold mortgages for homes they could barely maintain the payments on.  It’s a tragedy that so many have lost their homes, but we were sold homes and mortgages that were too large for our safety nets to catch us. Those who sold these “too good to be real” deals should be penalized, but our government has looked the other way.  I hope my children learn from this error in American history.

  • Richard Rickel

    The Obama adminstration must pass legislation to help homeowners be able to lower their interest rates. 

  • Anonymous

    I experienced the HAMP process. I was lied to by Wells Fargo. I was given the runaround. I was presented a “forbearance” that was nothing more than a money making scheme of 33% interest and a huge lump sum that put me and others at risk. I never accepted the suckered “lower your mortage payment” and sent in full payments during the trial period. Wells Fargo, did Not send the money to the lender, Fannie Mae. Wells Fargo put my mortgage money into their account, for 4 months of 2009 and when I discovered they had “not applied” their answer was pretty lame why they never sent the money to Fannie Mae, the lender. They also “dinged my credit” so I could not refinance through another broker. Wells Fargo controlled appraiser pools and directed appraisers to “low ball” appraisals to keep people in subprime loans if they wanted to work as an appraiser.

    I concluded, the banks were using HAMP to make money with the TARP loss share guarantee money from the FDIC via the FED’s secret TARP money.

    Wells Fargo’s VP of mortgages testified that Wells Fargo loses money with foreclosures but with the hundreds of thousands of foreclosures and shortsales, Wells Fargo made $10 Billion in Profit in 2010.

    Wells Fargo was a predator and used HAMP to make money. This report is correct, that the HAMP program had no “teeth” and was “Voluntary” but in the case of Wells Fargo and the sevicing banks, they aggessively used HAMP to “get people’s homes and the number one asset of the Middle Class – home equity” making tons of money via Insurance or the Loss Share Agreement $1.4 Trillion available. The $85 Billion for HAMP was chump change but only $1 Billion was spent of the HAMP funds after 24 months in HAMP and the “Secret $1.4 Trillion of the TARP made Wells Fargo very Profitable while 1.6 million kids are homeless with thousands of foreclosures.

    http://www.youtube.com/watch?v=ssl5yb7FewA

    Your Program was “too lenient” on what Wells Fargo did to possess homes of people who were going and continue to go through tough times.

  • Tammynolff

    I believe the banks should work with people and do what ever it takes to keep people in their homes. My spouse left me with a mortgage and no job. I got a job,and I paid for the house for 5 years before I ran out of money.  I went to 7 different government programs and none would help. my house was not a mansion, less than 2000 sq ft and I only owed $100,000 but it was my home.  Obamas comment that few people took advantage of the programs is not quite true. people like me have tried, but too many conditions make it impossible. that process took 9 torturous months and no one would help.  I just gave up. the rejection and process of jumping through hoops took its toll on me emotionally and  physicaly. the banks don’t care. I am angry because my bank double dipped into the fed. reserve for bailouts. i don’t want a handout i just want help.

  • Thecrop

    Just because she had a home that valued so much doesn’t mean she couldn’t afford it.  Maybe she bought it and fixed it up.  After all, 800k was it’s value but not her balance.  To me, the real issue is that no one-not even the government can make these mortgage companies do what they should do.

  • http://pulse.yahoo.com/_3NIBP4HJ2EJ5M5XBC7GGFXZLIU JD

    A 4000 sq. ft. home worth $870,000 on $135,000/year!
     The realistic rule of thumb for for a “normal” home buyer is about 2 1/2 times your annual salary. She could afford a home for $337,500. Or, taking it the other way, she should have been making $348,000 per year to afford a home like that. She was a player, and I hope she enjoyed the good times and the banksters greed while writing notes for unqualified borrowers. When she couldn’t refi she involuntarily bailed on the contract she signed, quite possibly cutting off the cash flow to a pension fund supporting a bunch of retirees. Some of those retirees probably using those pension checks to pay their own mortgages. Those folks that bought way over their ability to pay are now hurting those who were prudent. I too was making six figures before I lost my job. Opposite your example, I bought a home I could afford and manage to keep if I wish.

  • Graciemary

    Banks only care about money in their pockets and greed is now, and always has been, their only priority!   We have see that clearly with the loan modification process, or the lack there of!   Homeowners took out loans on mansions they could not afford and the banks encouraged this is their greed motivated loan approvals.   Both should be held accountable for their irresponsibility.  There is an incredible amount of fraud and deception on the part of both the banks and the homeowners!  We live in a society/culture that seem to be only capable of immediate gratification, with little interest in the BIG PICTURE of the long term effects of one’s actions or how one’s actions effects others.   I see homes that are in foreclosures, where the homeowner isn’t paying their mortage; however, monies are spent on luxury items while the “homeowner” continues to live in the home for nothing!   We all pay for this irresponsibility with the value of our homes depreciating due to the many deliquentcies. 
      My mortage was with a small, local bank that did not sell its mortgages.  The bank has been in the community for many years and was committed to being an ethical member of the business community.   I srtongly encourage you to do business with the small local banks with a long history in the community as well as with local Credit Unions.

  • Rp Jcbsn

    The only person that Ms. Martinez has to blame for her situation is herself. She was obviously living beyond her means, as so many people do! Odds are she has other debt in addition to the morgage. Who did she think she was fooling living in a home like that, and I’m sure living a lifestyle to match it. People need to look at debt differantly than they have in the past. What is the total cost of things?… not what is it’s cost on a monthly basis. I believe that 30 years is too long of a term to pay for a house, and most take much longer than that. There is little possibility to really get ahead in this world if you are constantly dragging debt. It.s time to pay the bills and live with in our means, with some left over for a rainy day at the end of the month!  

  • George N. Wells, CPIM

    I had a very hard time trying to empathize with Martinez as well.  Yes, she lost her very expensive house in a gated community due to losing he employment that paid her wages in the upper income brackets (perhaps this is the PBS demographic).  However, she did lose a job paying $135K/year but also landed a new job paying about $100K/year.  My brain kept yelling: “What is she doing with a $600K mortgage (not forgetting the fees for the gated community) on a salary of only $135K?”  With all the peoole losing homes out there, why did you showcase this particular individual? 

  • http://pulse.yahoo.com/_3NIBP4HJ2EJ5M5XBC7GGFXZLIU JD

    “To believe in the American Dream, ya gotta be asleep.” – George Carlin 

    “There’s a sucker born every minute.” “This way to the egress.”  - P.T. Barnum

  • Kim Martino

    I agree with your comments.  Unfortunately, the four-minute result of the three hour interview did not convey the message as I would have liked.  What they didn’t mention is that I do not believe the government should have somehow “helped” me.  My disdain was not only with the securitization of my loan, which prevented a short sale or reduction in principal or interest, but also with the disorganized loan modification process that promised false hope to so many folks.

    The circumstances that led up to the foreclosure were completely my responsibility.  I have learned to never judge a person based on hearsay.  People will assume what they will based on the information presented to them.  There is much more to the “story” than what made the final cut.

  • Drbreeze

    NEWSFLASH: Someone making 135k per year can easily afford a 600k mortgage! Maybe if the commentors on this thread spent more time comprehending basic math, they wouldn’t spend their lives acting like a bunch of envious underachieving losers!