We realize it is hard times for everyone, however, when a disaster such as this happens in the World it makes you realize that everything can change in the blink of an eye.  Whether it is from good to bad or from bad to good.  The people of Japan lost their Mothers, Fathers, Children, Brothers, Sisters, Cousins, Friends, School Mates, Co-Workers in a matter of moments.  Yes, in America we are having tuff times but at least we still have the ability to laugh with our friends, hug our parents, kids, wives, and siblings.

Our happiness and current situation is all relative to where we are in the world.  We can shut our TVs and not read the papers and pretend that nothing is happen or we can follow every waking moment.  Neither which we think are great ideas.  We think us as a nation should be conscience of what is going on and try and help in some small way.  We know even after a major disaster the sun is going to rise and we as a race of human beings will continue with our daily lives.

To conclude, most of us have suffered from losing a loved one, a job, a house; but to lose it all at once can be paralyzing.  We may not have the ability to to solve the Japan crisis, but at least we can try and alleviate some of the pain for these poor poor people.

Many webpages are dedicated to debating who is at fault for the real estate crash; whether it was banks or Americans. The conclusion of who is to blame is for the reader to decide. However, as Americans we need to move on into the future and correct our and the banks mistakes. No matter how bitter a consumer may be at the banks they need to try to move on with their lives, though this is easier said than done. Many Americans are so disgruntled with banks because they did not show compassion for deceiving the consumer, lying to the homeowner, or the extenuating circumstance the borrower may be in that some homeowners are retaliating against the banks.

Remember banks are a business and they are looking to survive in this economy. Most businesses will show no compassion if it is between their survival or your survival. This is why when a homeowner defaults on their mortgage the banks are foreclosing on their homes. The majority of banks have heard the same hardship story so many times that if your situation does not fall within a legal obligation to them they will put you at the end of the line for help. The banks do not even hesitate to foreclose on homes. This is why it is so important to obtain legal counsel; however, some individuals have taken matters into their own hands.

Some consumers have retaliated by stripping their home of all its accessories and selling them in hopes of recuperating some of their financial loss. While this may feel good for the consumer in the moment it is a federal offense. When the bank forecloses on your home they own the home and everything on the homes property that is attached. Therefore, what these ex-homeowners are doing is a felony. Stripping homes has become so prevalent in Arizona, California, Nevada, and Florida the FBI has created a division just to deal with the matter. The FBI tracks their targets down by pawn shops, Craig’s List, Ebay, etc. Additionally, stripping became so common that it has made national news. Below we show a piece done by NBC where it can be found at www.NBC.com from the Today show. The story was a collaboration by News Anchor Matt Lauer and Report Miguel Almaguer.

Remember even if you are going to lose your home, credit, and current living status it is nothing compared to being thrown in a federal prison and compromising your moral standards. This is why American’s need to rally and fight the good fight in the court system. Find a way to make every crooked banker pay for their mistakes while maintain your own integrity.

Matt Lauer: We are back at 7:47 AM and this morning on Today’s Money Pits it is a growing crime involving the struggling real estate market. Brazen thieves who are stealing anything of value from a foreclosed property and oftentimes the suspects actually lived in the very homes their targeting. Here’s NBC’s Miguel Almaguer.

Real Estate Agent: We have 3,474 sq. ft…

Miguel: For homebuyers like the Parishes…

Real Estate Agent: They took everything…

Miguel: …buying a property asis can mean going without.

Real Estate Agent: Here we have the sliding doors missing that need to be replaced.

Miguel: Nearly every foreclosure they see requires vision.

Real Estate Agent: And this would be your kitchen island.

Miguel: What makes a house a home unceremoniously ripped out. The properties are just a shell of what they used to be; it is called foreclosure stripping. A problem so rampid in Arizona the FBI is now involved.

FBI Representative: What we are seeing homeowners as they are facing foreclosure doing this umm and the motivation is to recover whatever sort of investment they might have made in the property.

Miguel: With foreclosures up 600% in Phoenix since 2005 stripping has shot through the roof.

FBI Representative: …they tell us that their upset because of…..

Miguel: The FBI says that this property was flooded by the former owner. Many of these crimes are carried out by angry families forced to leave their homes.

FBI Representative: What are you finding on Craig’s List…

Miguel: Federal agents routinely scour the web for fixture sales.

FBI Representative: This is our target…

Miguel: Then arrests former homeowners tried to flip appliances and fixtures that were once theirs and are now bank owned property.

FBI Representative: These are the first of these types of cases that we worked. It is across the board we have seen it from high-end multimillion dollar homes, to the low-end homes, to condos, to townhouses. It runs the gamut.

Miguel: What was also surprising is what’s stolen. Anything bolted down has been ripped away not just appliances and fixtures but door hinges, light switches, and even the rug underneath the suspect’s feet.

FBI Representative: It was bought in 2006 for $280,000 but now because of the damage this house is selling for $69,000.

Miguel: Experts say the big losers here are neighbors. When a foreclosed home was stripped property values for an entire neighborhood can plumb it. Phoenix is a hotbed for stripping and it’s not just a problem in Arizona; California, Nevada, and Florida have all been hit hard.

Potential Buyer: …very nice…

Real Estate Agent: As you know…

Miguel: But the lost can be someone else’s gain.

Potential Buyer: I guess we can put our own stuff in here right.

Miguel: Homebuyers looking for a deal; as federal agents try to track down the steel. Former property owners who take everything; including the kitchen. For Today, Miguel Alvarere, Phoenix.

Clark Howard: A lot of us are exhausted by the finances in our household and I’ve got great news on that front. For five months in a row the Feds report you and I have reduced the amount of debt we are carrying. We are steadily on a debt diet. And it is virtually all kinds of debts the amount of money we are taking out on credit cards going down. The amount of money we are taking out for things like car loans is going down and I hope this trend continues. Because we as Americans are in so over our heads with debt that we need to get healthy. I know economists want us to run out and spend money here, there, and everywhere shop till we dropped and all that to boost the temporary or hopefully the permanent recovery in our economy. But for long-term permanent improvement in our country and for yourself we need to reduce debt. I’m Clark Howard for more on my ideas about your wallet go to cnn.com/Clark Howard.

Example: 

• ED McMahon
  • Ed’s mortgage was worth $4.8M and owed $644K therefore he was behind by 13.42% on his mortgage payments.
• Average Amercian Mortgage
  • The average American home was purchased for $247,900 in 2007 (height of market) according to the US census.  The average person in foreclosure is an estimated eight months or more behind on payments.  Therefore, average monthly mortgage $1,687 X 8 equals $13, 496 or 5.44%.

Ed was living far beyond his means.  His mortgage was greater because the value of his house was greater so his percentages may be greater than the average American, but he was a victim of circumstances just like every other American in financial distress.  His house was on the market for two years at the date of the interview and because he refused to lower the price of his house to a realistic market value he fell so far behind on his payments he had to foreclose on his home.  This is representative of a majority of Americans.  Many Americans are under financial duress, but because they believe the market will rebound or because they love their house so much they are not willing to lower the value of their home to be the market leader in their respective neighborhood.  As an owner you have to be able to bring money to the table if you want to sell your home in this economy or you may land up in foreclosure too.  If a person was certain the market would rebound or you were going to keep your job for ten more years then it may be worth fighting to stay in your home.  However, for most Americans it is to tuff to determine the next month. 

The idea MF Report is trying to convey is everyone is at the mercy of our current economic state.  If we live beyond our means and do not adjust our standard of living to our realty and current economic state then as individuals our lives may become an out-of-control rollercoaster which we are unable to regain control over.  Sometimes we may have to cut our losses to survive and be successful in the future.  Remember none of us have a crystal ball.

Below is a summary of the conversation between Larry King and Ed and Pam McMahon.  Please note it is out of context and not word for word. Enjoy.

Larry King:  What happened?

Ed McMahon:  How much time do we have?  Hahahaha! A combination it is like a perfect storm.  Economy problems.  Selling a house right now is a tremendous operations.  We have had this house on the market for two years.  We must have shown it 50 organizations and/or people. Nobody has made an offer it is a lovely home I hate to leave it I want to keep the home I want this all to work out.

Larry King:  And the payments, what is the problem

Ed McMahon: You know if you spend more money then you make then you know what can happen.  A couple of divorces flown in a few things like that, things happen, you want everything to be perfect.  That combination of the economy I have a little injury I have a situation and it all came together.

 Larry King:  What, you broke you broke your neck.  You feel? What at home?

 Ed McMahon: I do not want to elaborate on that but I feel and broke my neck.

 Larry King:  Has that Stopped you from working?

 Ed McMahon:  Oh sure, you know you cant work with this around your neck and uuuhhhh I have to wear this.

 Larry King:  But Pam the assumption is the McMahons are multi-millionaires and multi-millionaires how much behind are you  $644,000 that is what is reported.  Can’t pay; if you are multi-millionaires shouldn’t you be able to pay $644,000.

 Pam McMahon:  Yeah, I would like to know where those multi-millions are.  Where are those multi-millions Ed?

 Ed McMahon: Hahahahahah.

Due to the greed of the banks and the public our county has been placed in a financial bind.  Obtaining a loan modification, foreclosure, or filing bankruptcy are the only options for many Americans. However, it is unfortunate that during this crisis banks are still trying to profit from the situation instead of trying to rectify their mistakes and aiding their clients.

Loan Modifications would help the homeowners and the banks would still profit for several reasons.

1. The borrower continues to pay interest on an inflated principle for a longer period of time (i.e. changing the life of the loan from 30 to 40 years). When the borrower purchased their home it was most likely 25% to 45% overvalued.

2. By allowing you to stay in your home they do not have another foreclosure that will sell for a quarter of its value.

3. Obtaining incentives from the government to help a distressed homeowner obtain a loan modification.

Lenders have created a win/win situation for themselves. Therefore, if you are going to obtain a loan modification you should try to obtain the best deal possible. The banks are dealing with this on a daily business and are going to try and profit as much as they can from the situation. As such you should seek help from a lawyer (professional negotiator). A lawyer who “specializes” in loan modifications deals with this situation on a day-to-day basis. The law professional should understand all the current loan modification regulations and should know how to negotiate your interest rate, monthly payments, and any fees associated with the restructuring.

The banks who are supposed to be helping the mortgagee are/were wealthy corporations that have unlimited resources and a team of lawyers that write each document. Therefore, whenever a person asks you to sign a document (loan modification application) you have to be careful and skeptical. Moreover, have a full understanding of what you are signing. This is why we believe it is the utmost importance for all persons desiring a loan modification to consult an attorney during each step of the process. The initial outlay of money a person may have to spend for a lawyer may seem expensive at first (especially during these hard times), however, the money you may potentially save in the long run or the restful sleep you will get from knowing you have secured a roof over your family’s head in the appropriate legal manner is priceless in comparison.