Posted on 01/27/2008 5:03:23 PM PST by traumer
The streets are empty. Trash rustles down the road past rusted barbecues, abandoned furniture, sagging homes and gardens turned to weed.
This is Shaker Heights, a suburb of Cleveland and a town ravaged by the subprime mortgage crisis roiling the United States.
Faded "for sale" signs sit in front of deserted houses. The residents are gone, either in search of new jobs after the factories shut down, or in shame after being evicted for missing their mortgage payments.
A red, white and blue American flag flies over windows and doors which have been boarded up to keep the drug dealers away.
Thieves have stripped many homes of the plumbing, the doors, the windows, the aluminum siding.
The police station parking lot is full. The officers, who have seen their numbers triple since 2006, are coming back from their rounds. They speak of installing alarms in some of the homes claimed by squatters.
At 9422 Chagrin Street, a hand-scrawled sign attached to a window indicates someone lives there: "Please Used."
After three rings of the bell, Sarah Evans, 60, opens the door with a mixture of curiosity and alarm.
She says she is one of the last people left on the street. And she is on the verge of losing this two-bedroom house in which she has lived for more than 30 years because she simply cannot afford her monthly payments.
It is a complicated story. She refinanced in 2003, but did not realize the document she signed included provisions to radically increase the interest rate.
She stopped making payments in 2006 and shows her unpaid bills totaling 24,000 dollars.
Her bank is in the midst of eviction procedures.
"When folks buy a home they expect to die in it, I guess," she said as she stood outside in the cold. "I had my American Dream but it became a nightmare."
Her words are echoed by the angry barks of the guard dogs pacing behind a chain link fence two houses away that was installed by the new owner: a bank.
The massive parking lot of the Eagle Fresh supermarket is empty.
Behind her till, Myra Bibldwit lifts her head when a bell signals the entrance of a customer.
"Not many folks come anymore. We're used to it," said the 24-year-old cashier, one of the few in the neighborhood who managed to hold onto her job.
In the five hours since she started working today she has served just 10 customers. "Maybe you will buy something," she says with a smile.
Then comes customer number 12.
Laura Johnston, 50, says that her street -- about 10 minutes away by car -- was alive two years ago. Today, half the houses are abandoned.
"Folks could not afford their payments. They were asked to pay loans which doubled. They could not afford it, some lost their job. Lenders were greedy. They threw them out of their homes," she told AFP.
"I'm very upset. I missed my friend Helen. She disappeared overnight. She did not even say goodbye."
There are plenty of cases like Helen. They are called the neighbors who disappear in the night.
For county treasurer Jim Rokakis, the greed of the banks is to blame for this man-made disaster.
"All you needed was a pulse to buy a house. Some loans were written with no money down, no proof of buyer's incomes. They did not even check what people were saying. Most of those folks were jobless," he said in an interview.
"Shaker Heights was the perfect storm: poor folks, unemployed and a desire to get a piece of the American Dream."
Why? They're Ghostbusters? LOL
First I heard of this.
I think a couple of dozen stories have already been done on this neighborhood.
“Let’s not turn this into a civil rights issue when it isn’t”?
But maybe it is! Do you remember the “redlining” hearings and legislation that were in the news 6-7 years ago? It seems banks were doing background and credit checks on borrowers before making loans. Since that resulted in turning down a higher percentage of loans in minority area, the banks were accused of “redlining.”
Here’s a paper from 2001 on the subject: http://repository.upenn.edu/dissertations/AAI3003637/
I don’t remember if any special legislation was passed, but I believe it was, threatening lenders with the full power of the trial lawyers of the US, etc, etc. At any rate, they got the message that they were not allowed to deny loans to the poor and oppressed, just because they were poor credit risks.
What the ..ll did we think was going to happen if we penalized lending institutions for using good business judgment?
Another illustration of the Law of Unintended Consequences of a liberal feel good program.
You sell where there are sales. In stable neighborhoods there are not many sales, thus less sub-primes. I’d bet that map meshes up very well with RE turnover.
She probably has HEAP....the utility assistance.
Thanks for the Ping....
Just one more example of what we have been talking about.
State | County | City | Prop. Type | Bed / Bath | Price | Listing Details |
---|---|---|---|---|---|---|
OH | Cuyahoga | Brooklyn | Commercial | - / - | $750,000 | Property Details |
OH | Cuyahoga | Westlake | Commercial | - / - | $550,000 | Property Details |
OH | Cuyahoga | Strongsville | House | 4 / 2 | $339,900 | Property Details |
OH | Cuyahoga | Richmond Heights | Resid. Unit | - / - | $329,900 | Property Details |
OH | Cuyahoga | Rocky River | Resid. Unit | - / - | $309,900 | Property Details |
OH | Cuyahoga | North Olmst | Resid. Unit | - / - | $269,900 | Property Details |
OH | Cuyahoga | Rocky River | Resid. Unit | - / - | $252,900 | Property Details |
OH | Cuyahoga | Cleveland | Resid. Unit | - / - | $244,900 | Property Details |
OH | Cuyahoga | Bay Village | Resid. Unit | - / - | $196,900 | Property Details |
OH | Cuyahoga | Fairview Park | Resid. Unit | - / - | $189,900 | Property Details |
OH | Cuyahoga | Mayfield Heights | House | - / - | $185,000 | Property Details |
OH | Cuyahoga | Strongsville | Resid. Unit | - / - | $182,900 | Property Details |
OH | Cuyahoga | Euclid | Resid. Unit | 8 / 4 | $180,900 | Property Details |
OH | Cuyahoga | Cleveland | Resid. Unit | - / - | $176,122 | Property Details |
OH | Cuyahoga | Olmsted Falls | Resid. Unit | - / - | $174,000 | Property Details |
OH | Cuyahoga | Seven Hills | House | - / - | $173,000 | Property Details |
OH | Cuyahoga | Westlake | Resid. Unit | - / - | $169,900 | Property Details |
OH | Cuyahoga | Shaker Heights | Resid. Unit | - / - | $169,900 | Property Details |
OH | Cuyahoga | Chagrin Falls | Resid. Unit | 3 / 2 | $164,000 | Property Details |
OH | Cuyahoga | Parma | Resid. Unit | - / - | $163,900 | Property Details |
OH | Cuyahoga | Cleveland Heights | House | - / - | $163,900 | Property Details |
OH | Cuyahoga | Parma | Resid. Unit | - / - | $159,900 | Property Details |
OH | Cuyahoga | Euclid | Resid. Unit | - / - | $159,900 | Property Details |
OH | Cuyahoga | Parma | Resid. Unit | - / - | $156,900 | Property Details |
OH | Cuyahoga | Shaker Heig | Townhome | - / - | $155,000 | Property Details |
Population (year 2000): 29,405. Estimated population in July 2006: 27,245 (-7.3% change)
Males: 13,389 | (45.5%) |
Females: 16,016 | (54.5%) |
Median resident age: | 39.6 years |
Ohio median age: | 36.2 years |
Zip codes: 44120.
Estimated median household income in 2005: $64,900 (it was $63,983 in 2000)
Shaker Heights | $64,900 |
Ohio: | $43,493 |
Shaker Heights | $241,800 |
Ohio: | $129,600 |
Races in Shaker Heights:
Weird, Shaker Heights is at very upper middle class suburb in that state.
It doesn’t match the article I found at http://www.shakeronline.com/Media/PDFs/Uploader/1252008105546febhomestory.pdf
That’s kinda what I was thinking.
http://www.city-data.com/forum/ohio/115494-shaker-heights.html#post1246528
Read these 3 little comments must have been a boom in the day lots of old arc and supposedly safe now too! but declining in jobs unless maybe your the neighborhood crack salesman
I’ve bought a lot of property, I have been informed at every closing, verbally, about my loan situation they go through it and you have to sign it. My complaint has been how they treat you like little children but maybe my exerience is different, I dunno, or maybe some people need to be treated like children.
Wonder who is paying the police if all the tax paying citizens have left? This story has a scent that I can’t identify but don’t like.
Let’s do a thought experiment...
Now if you were a person, paying 50% of your income in rent and somebody came to you and said “I can get you the money to buy a house.” Would you take it? At worst you might lose the house and be back paying rent again if it goes wrong, but if you get a little luck a job promotion, an inheritance or something it’s a worthwhile risk. It’s smart move by somebody who has nothing.
If you were in the business of loaning money out to people - would you seriously loan money to people who couldn’t prove they would pay it back?
Of course not, you’d be out of business in no time.
So who in the hell would give these people hundreds of thousands of dollars to buy a house? Somebody who doesn’t carry the risk.
Intrigue pays for it it seems.
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