Will The Foreclosure Tsunami Lead To An Arson Boom?

Here’s a scary thought. The subprime meltdown and its resulting tsunami of foreclosures may lead to a boom in arson, says Fortune magazine:

Faced with foreclosure on her Russellville, Indiana home, Christina Snyder allegedly concocted the kind of plan that now has insurance executives on edge.

According to the county prosecutor, the 31-year-old Snyder allegedly offered to pay a neighbor $5,000 to help her burn down her house and make it look like a botched rape attempt – all in order to claim $80,000 in insurance money. Snyder wanted the neighbor to bind her hands in duct tape, write “whore” on her shirt, and then help her escape once the blaze was set, the prosecutor says. The neighbor demurred, instead reporting Snyder to police.

With the national foreclosure rate zooming and the real estate market in a two-year funk, the insurance industry fears more homeowners will see arson as a way out of their financial woes. A recent report by the industry-funded Coalition Against Insurance Fraud notes that with “untold thousands of homeowners struggling with ballooning subprime mortgage payments, fraud fighters are watching closely for a spike in arsons by desperate homeowners who can no longer afford their home payments.”

Oh, fantastic. That’s just what we need. Can’t pay your mortgage payments? Just “burn the m—-f—- down.” Wait, no. That’s a terrible idea.

And just because we can, here’s a clip from Harold & Kumar. (NSFW, audio) We hope this Burger Shack employee doesn’t have a ARM.

Will foreclosures spark an arson boom? [CNNMoney] (Thanks, Robert!)
(Photo:The Joy of the Mundane)


Edit Your Comment

  1. stanfrombrooklyn says:

    This will bring back the glorious days of New York City. Since their buildings only had insurance value, landlords used to set their buildings on fire and then have their crew roll wastebaskets into the street to slow down fire engines so they couldn’t put the fires out. In some cases firemen were shot at.

  2. MercuryPDX says:

    According to the county prosecutor, the 31-year-old Snyder allegedly offered to pay a neighbor $5,000 to help her burn down her house and make it look like a botched rape attempt – all in order to claim $80,000 in insurance money.

    Classy! As if legitimate rape victims don’t have a hard enough time.

    Snyder wanted the neighbor to bind her hands in duct tape, write “whore” on her shirt, and then help her escape once the blaze was set, the prosecutor says.

    “Mr.Wolf… the irony police are on line one. They’re saying a news story was ripped from a Law and Order:SVU episiode?”

  3. MercuryPDX says:

    @stanfrombrooklyn: Speaking of which… here’s a term I haven’t heard since I moved away.

  4. NefariousNewt says:

    @mercurypdx: Kinda reminded me of the beginning of Eraser, sans rape angle.

    It shouldn’t surprise anyone really. A house has no intrinsic value unless it’s a) sold or b) destroyed. So if you can’t do a)…

  5. this is why insurance rates are higher for people with bad credit

  6. warf0x0r says:

    Thank you for posting this video! I’m not even going to read the article I just love the video!

  7. Tracy Ham and Eggs says:

    But how is this the bankers fault? Who can we sue?

  8. com132 says:

    This has been happening a lot around Detroit. In fact, a conversation about buring down a house because it wouldn’t sell was overheard by my friend at the gym the other day. When she thought about it for a bit, she then realized that there have been over 5 fires in her neighborhood in the last year.

  9. DrGirlfriend says:

    Did this person not learn anything from the Tawana Brawley case?

    I’m really not sure how rape could lead to arson. This got way more complicated then it needed to get. How’s that saying go? Desperate times call for extremely contrived measures?

  10. darkened says:

    @DrGirlfriend: Have a candle get “flipped over in the struggle” into a clothes basket full moth ball dry table clothes you were going to wash with a bunch of papers and cleaning supplies right near the bin.

    Wow that’s a pretty great idea now that i think about it.

  11. NefariousNewt says:

    @darkened: Next to a propane heater… you need an explosion to make it look good.

  12. Anitra says:

    @DrGirlfriend: The owner was probably just trying to come up with some reason why someone OTHER than the owner would want to torch the place.

  13. Chaosium says:

    @DrGirlfriend: The exact kind of person braindamaged enough to think like Tawana Brawley is the kind of person that is incapable of seeing how that could be a bad idea.

  14. warning_label_101 says:

    We don’t need no water let the mother…

  15. Milstar says:

    It is possible, the lender I worked for had a case of Arson just after we refi’d a borrower.

  16. HRHKingFriday says:

    I don’t think this’ll make entire neighborhoods go up in flames, just more likely on an individual house basis. Though whole neighborhoods would be freakin sweet, extra points if its a bunch of mcmansions.

  17. bobbiac says:

    I wouldnt Doubt that it would cause more people to sonsider arson.

    However! This may lead to a large increase in adjacent lots for sale. This means that sma1l bungalow lots and other crappy properties could be bought, combined, and developed on with little initial costs. The resulting property could very well raise the value of the neighborhood.

  18. SexCpotatoes says:

    Yes. I just predicted this at breakfast two weeks ago. It will happen. I read some Arson statistics somewhere, something like 1% of all arsons get charges brought against someone, and only 1% of those cases end up with a conviction. You usually have to get caught, gas can and matches in hand, walking out of the flaming house to get nailed for arson. That or have witnesses finger you at the scene. The main reason for this is that arson usually destroys all proof that there was arson!

    Well, until the fire investigator determines that an accellerant was used and the insurance company will not pay out because it looks like you moved some expensive equipment out of the house days prior to the fire….

  19. csdiego says:

    @HRHKingFriday: “Though whole neighborhoods would be freakin sweet, extra points if its a bunch of mcmansions.”

    Not that I’m hoping for that, but yeah, it would be one way to get all that wasted land back.

  20. bohemian says:

    @Petrarch1603: Yep. We were late on a couple of payments last year and our homeowners insurance went up $100 a year due to “credit reasons”. They are freaking out that if people can’t sell homes this might look like an option to someone.

  21. mrmysterious says:

    I live in a nice neighborhood with all the homes well above the median home value. They are all less than three years old. September of ’06 a couple torched their house and still today the piece of crap is still standing. It pisses me off to no end.

  22. bradite says:

    I like it. Less houses = value of mine goes up, less ghetto neighbors. Maybe I should start selling matches and gas cans in my neighborhood!

  23. humphrmi says:

    No doubt this trend will be closely followed by another new trend: increase in prison population. Seriously, fire forensics have advanced substantially recently and assuming the arsonist isn’t a random vagrant who can disappear or (as often happens) a victim of their own crime, the homeowner will get nailed. There is almost no way to get the evidence that you committed arson off of and out of your body.

  24. mrspaz says:

    Judging by what I’ve seen people do to houses that enter foreclosure (ripping out wires, pipes, fixtures), I wouldn’t doubt that they’d consider torching the place as an alternative. Generally they aren’t the type of people to consider repercussions of their actions anyways (consider that they took that 3/27 optional-payment interest-only ARM in the first place) so they’d have few qualms about putting other people at risk for their own gains.

  25. mrspaz says:

    @humphrmi: If they’re smart, they go to Wal-Mart, buy the cheapest, most ghetto aluminum saucepan they can find, throw some ramen in there, turn it up on high on a rear burner (under the decorative pot-holders hanging on the wall), and then go do some shopping and catch a movie at the theater. Just double-check the policy to make sure it covers loss from “non-culpable negligence” or somesuch.

    ‘Course, they probably aren’t all that bright, so this is pretty much moot.

  26. savdavid says:

    Thanks, Bush! Now you are turning more middle-class and poor people into thieves like you and your buddies!

  27. Trai_Dep says:

    The fact that they caught her on tape buying a 50-lb bag of marshmallows at Costco 3 days prior isn’t helping her any.

  28. @trai_dep: she would have been sharpening sticks for days to have enough to do all that roasting.

  29. @Petrarch1603: No it isn’t. Or to put the onus for that ridiculous statement on you, where your evidence that arson is in any way related to credit score?? If you read some of the other comments, you’ll see that huge outbreaks in New York were tied to LANDLORDS…who probably had just fine credit. But I understand it’s fashionable around here to blame people with less money for everything, so whatever.

    Big companies charge the poor more money because they can get away with it, period. The poorer your customers, the less avenue for big flashy complaints they have. The Credit-scoring system is essentially just a big prop for solidifying and justifying that mechanism.

  30. I should also mention that in nasty, poor areas, that arson often has nothing to do with insurance money — for one thing, just TRY collecting insurance for a fire if you’re poor. HA!

    No, it’s often largely about crack-houses and crime. Vacant properties are bagnets for really, REALLY bad elements, and many times the city won’t do anything about the properties once they’re abandoned.

    Your kids are outside playing, and the vacant house three doors down is littered with needles and gang-traffic. Do you file another complaint with the cops who ignore you, or burn the sucker down?

    There but for the grace of some god, people…

  31. bagnets? That’s a new one….*magnets*, rather…::facepalm::

  32. rhambus says:

    @savdavid: Um, what precisely does George W. Bush have to do with people taking out idiotic home loans that they can’t pay back? We used to think it was good when banks were willing to take a risk on people with less money instead of just loaning rich people more money. Now it’s suddenly considered “bad” to do this because some of those people made stupid financial decisions that they nevertheless had every right to make (and pay the consequences for).

    At any rate, it’s hard to see what the President, of all people, has to do with this. Did he order Countrywide, et. al. to make these loans? I think not. The lenders made bad business decisions, and now they, along with the borrowers, are paying the price for them (as they should). It sucks that they are dragging down the economy to some extent, but honestly, the real problem started with those who didn’t have enough sense to not take out a risky mortgage in the first place. Let’s remember that the vast, vast majority of subprime borrowers ARE paying the loans back.

  33. the_wiggle says:

    @bohemian: people are getting credit card rate increases &/or line decreases; some poor bastards are getting the same on their home equity loans as well. these things can tank what’s left of the budget as they usually result in substantially larger min due payments.

    way to kick’m while they’re down :(

    @Mary Marsala with Fries: indeed. wait the news regarding the trend for each lender to have their own score + system kicks off. never mind that the score your lender pays for is seldom the score you paid to see

  34. molife says:

    I could totally see a guy in CA during the wildfires watching the fire getting closer. And praying…that it got closer! LOL! And maybe even kicking a piece or two of brush across the road…that just happened to be on fire…onto his side of the road. That he stopped watering as soon as the fires started to break out.

    “What’s all that new shrubbery Bob? Kinda looks like dried up tumbleweed! Must be modern design eh?! But why do you need so much of it?”