‘All of a sudden, we’re back’
Doug Burns, 65, of Tega Cay, was the managing principal of an architectural firm in Charlotte when he was laid off in 2010 as the construction industry tanked.
But his troubles began a couple of years earlier as the real estate crisis led the country into the worst recession in a lifetime.
In 2008, he and his wife, an educator, applied for a loan modification on their $500,000 house, with a $4,000-a-month mortgage payment, through their bank, Chase. After a laborious four-month process, he said, they were turned down.
Stock ownership and other assets derailed their bid to refinance, he said.
As Burns struggled with underemployment, the couple divested stock, lowered their portfolio and tapped into their retirement accounts. Then they reapplied for a loan modification and again were turned down, this time for insufficient income, Burns said.
Despite landing a $100,000-a-year job, Burns still had to drain the couple’s 401(k) and other retirement accounts, he said. He was making only half of his previous salary.
“It sounds like a lot, but in reality, when the basis of your life is on a number that is significantly higher, how do you cut back?” Burns asked. “What do you cut back on?”
With the real estate market — particularly for higher end homes — virtually dead, the Burnses went in for a third attempt to modify their loan. Finally their bank gave them hope that it would be successful. But four days later, they received a letter rejecting their request because the loan had been sold and the new mortgage holder was not participating in modifications.
Finally, the couple found what seemed like a real solution when they heard a radio ad about SC HELP.
They applied and, working with South Carolina Legal Services, were approved for help. Their $4,000-a-month mortgage is being paid for six months.
The program is a great bridge, Burns said.
“By having the range of mortgages (those up to $729,000 are eligible for the program), you really open this up to people of all professions and all walks of life,” Burns said.
“For people who don’t give up, the idea is, if we can make this work and all of a sudden we’re back, we keep our home, we pay property taxes, it doesn’t bring down anybody else’s property value, it doesn’t change the neighborhood,” Burns said.
‘I have to move, I don’t know when’
Adele Townsend was so excited about purchasing her first home in 2007 that she bought the first house her real estate agent took her to see.
What she didn’t realize was that the economy had hit its peak and the nation was in for years of economic turmoil and record jobless rates.
The unemployed 37-year-old mother of four said she has been scammed twice out of money she couldn’t afford to lose — once for $1,200, and again for $1,000 — both times while seeking loan modification assistance.
Foreclosed upon by the mortgage company with which she thought she had a fixed-rate loan, Townsend is now waiting to be evicted, and wondering where she and her family will go.
“It’s been a mess ever since I signed the paperwork,” Townsend said through a nervous, exasperated laugh.
“The house is old, and a lot of the things they said they did on the paperwork, they didn’t even do, like inspect for termites, the mildew and all of that. They did none of that,” Townsend said.
Townsend lost her job as store manager of a gas station in 2009. Then, the mortgage she thought was at a fixed rate rose from $1,000 a month to $1,500 a month, and a third time, to $1,700 a month, she said.
“For a three-bedroom house, it’s not worth it, and I can’t afford that,” Townsend said of her 2,000-square-foot, vinyl-sided house. “This whole thing was just a big mistake.”
The mortgage scammers Townsend fell for through television advertisements first persuaded her to wire them money, then convinced her that she should stop making her mortgage payments.
Now, there are lawsuits by the federal government against the mortgage company Townsend used.
Townsend isn’t looking to stay in her house. She is looking for a fresh start, seeking up to $5,000 in relocation assistance from SC HELP to move to a more affordable home.
She hasn’t received a decision, but she is hoping it comes before the eviction.
“I know I’m going to have to move, I just don’t know when,” Townsend said.