Posted by Brian at 6:27 PM
Notice a difference?
Today's Bob Herbert:
It’s a largely bewildered, frightened group that includes people like Dorothy Levey, a 79-year-old widow who sits alone inside the small house she has lived in for 41 years, afraid to answer the telephone or the door.
She has every reason to be worried. The monthly note on her house in the city of Markham, just outside Chicago, is approximately 100 percent of her meager monthly income. Broke and behind in her payments, Ms. Levey expects a foreclosure notice to show up any day, followed by a visit from “the sheriff, or whoever they send to tell you to get out of your own home.”....
After faithfully making mortgage payments for decades, Ms. Levey and her husband, Dan, were persuaded to take out a new loan, ostensibly for debt consolidation, in 2002. It was like plunging into quicksand. Dan was seriously ill at the time and he died two years later.
To this day Ms. Levey does not understand what she and her husband of more than half a century had agreed to. The terms might as well have been written in Sanskrit.
But she kept trying to meet her obligation. She exhausted her savings. She lost her car. She stopped buying clothes and cut back on food. But there was no way to keep up with the payments.
“I had to go to the state and tell them I was hungry,” she said.
Joe del Bruno AP Business Writer:
NEW YORK (AP) -- When Domenico Colombo saw that his monthly mortgage payment was about to balloon by 30 percent, he had a clear picture of how bad it could get.I've written about this before--how the media focuses on well-to-do people getting hammered by the mortgage meltdown but leaves the people hit hardest by it out of the discussion. Herbert made the same point in his Op-Ed, and this is a perfect example. Mr. Colombo's house payment was going to go up by $1500 a month, and that was a 30% increase. So what is he paying already? (The math is left as an exercise for the reader.) The increase in his mortgage payment is significantly more than Amy and I pay in rent for a 2-BR apartment, just to give you a sense of the market here. Let's just say that Mr. Colombo doesn't have to wait for the 2 Big Bufords for 3 dollars special at Checker's if he doesn't feel like it. And he was able to get out of his crappy loan and into a fixed rate mortgage. Why tell his story? Any ideas?
His payment was scheduled to surge by an extra $1,500 in December. With his daughter headed to college next fall and tuition to be paid, he feared ending up like so many neighbors in Fort Lauderdale, Fla., who defaulted on their mortgages and whose homes are now in foreclosure and sporting "For Sale" signs.
Colombo did manage to renegotiate a new fixed interest rate loan with his bank, and now believes he'll be OK -- but the future is less certain for the rest of us.