There’s an interesting detail at the end of this New York Times article on borrowers who strategically default–that is, they choose to walk away from the home when its value is significantly less than the mortgage balance. It turns out that the homeowner mentioned at the start of the article applied last fall for a loan modification with Bank of America after his income level had dropped, and this was BofA’s response: “The lender came back a few weeks ago with a plan that added more restrictive terms while keeping the payments about the same. ‘That may have been the last straw,’ Mr. Koellmann said.” [More]
Are you looking for a new apartment or house? Apartment Therapy has some advice about what questions you should ask before putting your name on a new lease. We’re featuring this on Consumerist because there is advice about negotiating extra fees and deposits for cats, a crucial topic for our readership. [More]
Last October, Bank of America screwed up and seized a vacation home that didn’t belong to them. They also changed the locks and shut off the power, leaving 75 pounds of salmon and halibut rotting for a week before it was discovered, writes Laura Elder of the Galveston Daily News.
The owner, Dr. Alan Schroit, and his wife discovered what had happened when they showed up on Halloween to prepare for a party they were going to host the next day.
The publisher of a series of home improvement books has announced a recall of nine of them, because of errors in their instructions on installing or repairing electrical wiring. The Consumer Products Safety Commission says no injuries have been reported so far even though the books have been published since 1975, which I think proves that nobody has ever actually attempted a project from any home improvement book. [More]
“Homeowners should be walking away in droves. But they aren’t. And it’s not because the financial costs of foreclosure outweigh the benefits. One can have a good credit rating again–meaning above 660–within two years after a foreclosure.” That’s the conclusion reached by a law professor who’s written a paper about strategic default, which is when you elect to walk away from an underwater mortgage because you stand to lose more money trying to keep it than if you cut your losses immediately. The problem is, lots of people think it’s the wrong thing to do, because individuals are supposed to play by different rules than the companies they do business with. [More]
Are you hitting that stage in life where you’re thinking of becoming a homeowner? Morningstar has published two home buying articles that together offer some good, concise advice to the prospective buyer, especially if you’re a first-timer.
Yesterday the Consumer Product Safety Commission (CPSC) announced some findings from its study of the problematic Chinese drywall, which 1,900 Florida homeowners have complained stinks and makes people sick. The commission told the Associated Press that “no connections have been made yet,” but that they’re doing more tests—which means there’s still no definitive answer on who should be held financially responsible if the homes have to be gutted and repaired, which the Wall Street Journal says could cost as much as $25 billion dollars.
Detroit tried to auction off almost 9,000 homes and lots last week—enough property to fill Central Park—but Reuters says less than 1/5th of what went on the block actually sold. Unfortunately, it sounds like speculators snatched up few decent properties, leaving actual Detroit residents looking for new homes out in the cold.
Your new washer, dryer, fridge, monitor, or TV set may have an Energy Star label on it, but it turns out that nobody is making sure that means anything, reports the New York Times. Our parent organization Consumer Reports pointed out that this was a problem a year ago.
Earlier today a former Fannie Mae exec and the current head of the FHA gave conflicting testimonies to Congress about the health of the mortgage insurer—particularly about whether or not it’s going to require a taxpayer bailout in the next couple of years.
An unidentified person has offered $8.75 million cash–more than the asking price–for Bernie Madoff’s beachfront home in Long Island. Bidders made sealed offers for the property, and the realtors say they won’t reveal any more details until after the deal closes. The house is supposedly very fancy, but if we lived there we’d just tear it up looking for hidden piles of cash. This is why we can never have anything nice.
Three children have died after being strangled in the cords of window blinds, so today six companies announced a massive recall of several brands of window treatments.
A city in Florida has just warned its residents of a weird scam: someone’s been hanging pink notices on doors around town that say, “Due to the water quality in this area, we will be installing whole-house water treatment systems.” You’re supposed to fill out the back of the notice and leave it out for further contact. Remember, don’t let anyone remodel your home on behalf of the city. It probably goes without saying, but still.
Imagine coming home to find the sheriff on your doorstep with an eviction notice, and then being given 3 hours to get the hell off your property, which is no longer yours because your bank mistakenly sold it out from under you for about a third of its value. Oops! Although we initially assumed WaMu/Chase was behind all of it, NCB Miami reports that actually “a mistake in the Miami-Dade Clerk’s Office appears to be behind the mishap, which landed Ramirez homeless for more than 24 hours.”
CouchSurfing is an online community of friendly hosts who are ready and eager to throw their convertible couches open to travelers from across the world. The service offers more than a free place to crash; it connects travelers with like-minded people who are excited to share their enthusiasm for their hometown. But aren’t you going to be immediately robbed and stabbed by the opportunistic lechers lurking on the internet, you ask?
Never, never open your door to a contractor who randomly appears offering to fix some unseen problem. You would think it’s common sense, but a California senior ended up paying a shady contractor $20,000 to perform $300 worth of work, and it took a sting operation to stop a Long Island contractor who was going door-to-door offering to plug nonexistent carbon monoxide leaks. So how can you protect yourself? Here are a few warning signs to beware….