City At Vanguard Of Housing Crash Could File Bankruptcy This Week

Back in August 2007, when many of us were still taking out adjustable-rate loans to pay for the water slide on our new champagne-filled jacuzzis, reports of impending doom were coming Stockton, Calif., a city that had suddenly jumped to the head of the foreclosure pack, with 1-in-27 homes being taken back by the bank. Now, five years on, it looks like Stockton could be due for another ignominious honor, as it stands to become the largest U.S. city to declare bankruptcy.

CBS Sacramento reports that the city is attempting to reach last-minute deals with its creditors or face having to file for bankruptcy as early as June 27.

The city says that the housing crash has hit the property tax coffers hard. If Stockton does declare bankruptcy, it’s leadership swears that police and fire service will not be cut.

However, there will be increases in parking tickets, in addition to pay cuts for municipal employees.

In 2006, the foreclosure rate in Stockton was at 1-in-157 houses, which was high enough for RealtyTrac to list it as the 15th highest rate in the country.

But in only one year, that rate skyrocketed to the 1-in-27 number, putting Stockton just ahead of Detroit’s rate of 1-in-29.

In 2008, the city was the focus of a BBC documentary, one of the first to uncover just how royally the subprime mortgage market had been screwed up — and the far-reaching implications of the housing crash.

Later that year, it took the #2 spot in Forbes’ list of the Most Miserable Cities in the U.S.

Comments

Edit Your Comment

  1. Costner says:

    Did you purposefully go out of your way to draft a confusing headline? At first I was thinking there was a city called “Vanguard” and was trying to determine what your native language was before realizing you were just adding extra words that didn’t help.

  2. Schildkrote says:

    “If Stockton does declare bankruptcy, it’s leadership swears that police and fire service will not be cut.”

    http://eloquentscience.com/wp-content/uploads/2010/02/bobsqu.gif

    • Snapdragon says:

      +10000

      I have that printed out and hanging on my wall.

    • Kaleey says:

      I would like to comment that while your cartoon is humorous, it does not address the grammatical error within the statement you referenced.

      The rule that has been violated is: when using the possessive of a pronoun (it, him, her), the apostrophe should not be used.

      Incorrect: it’s feet, his’ chair, her’ paper
      Correct: its feet, his chair, her paper

      (K, currently wishing for an edit button, just in case I mess this up, and look like a blithering moron.)

  3. McRib wants to know if you've been saved by the Holy Clown says:

    You know what would solve this problem?

    Lemonade!
    Because when life gives you lemons, you make lemonade.

    • The Cosmic Avenger says:

      “When life gives you lemons, don’t make lemonade. Make life take the lemons back! Get mad! I don’t want your damn lemons, what am I supposed to do with these? Demand to see life’s manager! Make life rue the day it thought it could give Cave Johnson lemons! Do you know who I am? I’m the man who’s gonna burn your house down! With the lemons! I’m gonna get my engineers to invent a combustible lemon that burns your house down!”

    • exit322 says:

      No, you make orange juice. Then watch people wonder how in the hell you just did that.

    • Will Print T-shirts For Food says:

      When God gives you lemons, find a new God.

  4. FatLynn says:

    I was there about a week after George Bush, in 2006. The hotel showed us everything they had remodeled for his visit. Nicest place in town, and it was still a total dump.

  5. CosmosHuman says:

    What I can remember about Stockton, CA is from the TV show; “The Big Valley”. I used to watch that show, in re-runs on Sunday morning when i was a teenager. Boy, things sure have changed.

  6. Torchwood says:

    Stockton is essentially a bedroom community for the San Francisco Bay Area. I live about a hour from Stockton, and there is nothing there that says “Come visit and stay a while”. It’s more like, “Give us a wave as you head towards LA”.

    Of course, being a total subscriber to, “Nothing is too big to fail”, I say let them declare bankruptcy. The unions, of course, want to avoid this because it effectively voids out contracts.

  7. Blueskylaw says:

    If Kal-e-four-knee-uhh itself is bankrupt, wouldn’t
    that automatically make every city bankrupt?

  8. Revolverkiller says:

    I live here in Stockton, its not as bad as everyone says. *shrugs* things are tough all over

  9. ferozadh says:

    As Dre once said in famous Tupac song:

    It’s all good, from Diego to tha Bay
    Your city is tha bomb if your city makin pay

  10. Duke_Newcombe-Making children and adults as fat as pigs says:

    Ah yes, my hometown. If you can’t be famous, be infamous.

  11. Princess Beech loves a warm cup of treason every morning says:

    Nah. When life give me lemons, I make a mojito. That way, the more lemons life gives me, the more drunk I get.

    ** OK if this post ends up posting 50x it’s because of the ’504′ error code.

    • Princess Beech loves a warm cup of treason every morning says:

      And this is in-line with McRib’s above comment.

      C-ist tech issue is driving me nuts today. >:|

    • Maltboy wanders aimlessly through the Uncanny Valley says:

      I thought mojitos were made with limes.

  12. phonic says:

    So is Consumerist working now?

  13. Jimmy says:

    Buy high, bankrupt low.

  14. T. Bone says:

    USA and the state of ILL. could be next………..$15,734,596,578,458.59 – The U.S. national debt as of June 7, 2012……Illinois has a total state debt of approximately $280,595,828,000, when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and the budget gap.

  15. Mongo says:

    It should, properly stated, be “city IN the vanguard”