Thursday, February 23, 2012

Foreclosures Everywhere

Many rural homes in foreclosure require either major systems overhaul or maintenance which would not be easy for a first time home buyer to perform.


This is what I call a "castle foreclosure". The maintenance, property taxes, and electricity  on such a home are likely to be so high that no one should buy such a house without paying cash. Yet many people have very high mortgages on such properties.

Houses in good condition as foreclosures are often overpriced by banks. Many times the best deal comes from buying from an individual who needs to move, not from a bank who might have very unrealistic ideas about the pricing of a foreclosed home.

       I have mentioned before that we live in a rather unusual area.  When Daniel was small, and our other children were seven, twelve and thirteen, we moved from a large home in the suburbs out to an exceedingly rural area.  We wanted them to have the chance to learn things that we had learned as children growing up in the country. We wanted them to raise ducks, chickens, and rabbits, and perhaps have horses or other larger livestock. We wanted them to learn to self occupy and to read volumes of books rather than books.  When we moved here, there wasn't a gas station for twenty five miles. There was no mail delivery, and still isn't.  The post office nearest us had closed in the seventies, and so we became accustomed to picking up our own mail.  There isn't cable television here.  One tries to pick up a couple of stations over the airwaves.  The first year was difficult for them as they missed friends, and adjusted to homeschooling here, while seeing new friends once a week rather than once a day.  They missed Tae Kwon Do, and Wendy's, Chinese food, and the occasional slice of pizza.  It took almost a year for the kids to begin to enjoy the skies here where one can study the weather by noting the clouds.  The night sky is amazing here, as there is absolutely no light pollution at night, and one can study the constellations and the milky way with ease..  A year later, ours kids were as busy with their homeschooling,  homeschool group gatherings, church, animals, exploring art projects at home, and learning to create a pond garden.  I am often glad that we made such a decision. Moving them to a place without so much external stimuli has allowed them to become more closely who they were meant to be, and not simply become reflections or copies of a society which appears to be in sharp decline.  I am glad Daniel had the opportunity to be close to his family, have all the animals he had, travel to the city when we needed, and have time to explore his computer, books, and the world which he came to love so.
             In 2008, when Daniel passed and the economy began to fail, we were fairly well economically insulated here, and we realized this. Most people could already not afford to live here because the fuel needed to commute to work would make it difficult. We moved here following a series of happy accidents which made building a farm here possible for us.  Most of the people in our area have either been here for many generations, and have prospered in that time, or they were wealthy people who chose to buy or build a farm here when America was in a boom time.  There are people who are not wealthy, and they often work for the people who are.  We occupy the dubious slot of being a middle class family here.  We are not wealthy enough to fit with the grand farms of thousands of acres, but certainly are not poor.   When the economy began to deteriorate, brick by brick, circumstances began to change for those who live in our rural county.  The wealthy stopped getting dividends, and so much interest, and they began to have to sell things that they likely should not have purchased in the first place.  The poor became more political, but much of their lives did not change, because they had made the adaptations to not having as much long ago.  As the poster family to the local middle class, we found that we could not continue to pay for our children in college, and they had to take student loans.  Each group made the adjustments which were required, and we remained somewhat isolated here.  The boom times never came here and so when they disappeared in the rest of the country, we were insulated from at least some of the fallout from it.
                In late 2011, and early 2012, our idyllic rural berg is no longer isolated from it.   Apparently, a lot of people were simply holding on as best they could.  The earthquake in August which damaged many local homes was more than many families could bear. A number of desperate homeowners put homes and farms up for sale following the earthquake last year.  With mortgages so hard to get, and jobs so hard to find, no matter where you choose to try to commute, none of these homes sold, even with prices reduced.  By Christmas, many of the most beautiful homes stood empty, with their chimney damage still all over their roof.  Anyone who thought there would be opportunities to buy homes inexpensively was wrong.  Locally, the banks held on to homes, waiting for the economy to improve, and empty houses with often undiagnosed damage continued to be unmonitored and continued to be damaged by aftershocks.  Now, wealthy people and the poor are equally afflicted.  No one has any money, and our community is sadly watching one family after another depart.  Many of them are moving in with other relatives, as they cannot afford a home of their own just now.  In a lot of ways I would imagine our county is back to what life was like for some during the Great Depression.  Our local social services is greatly stressed.  Despite the fact that a couple of churches started new foodbanks, our local foodbanks cannot meet the need, and local churches are stretched beyond their imaginings.  Some local churches are buying food in bulk, and then dividing it for parishioners, who ultimately come and help divide the rice, beans, cheese, and chicken bought in bulk.  For a modest sum, a family can buy staple items their weeks groceries through rural churches.  The churches are also gathering to teach people how to can the foods that so many people here grow during the summer.  Our closest country restaurant, which was twenty-five miles, closed abruptly recently.
                 We survive mostly because my father always believed that the Great Depression his parents endured, would come again. He always conducted himself frugally, and made sure that I knew how to do the same thing.  My in-laws also taught principles of frugality to my husband.  My husband and I cannot be credited with our financial survival through these difficult times. Both sets of our parents should be.  Before they all left this Earth, they taught us how to buy and prepare healthy food ourselves, how to grow our own fruit, vegetables, and raise chickens for eggs.  They taught us to barter with neighbors when possible.  It was during all of this preparation that we truly spent time with our kids, and they truly got to know us, as well.   We have survived because we always have lived below our means. When medical bills and funeral expenses came, we paid them, because our family taught us to value education and frugality. Still, it would be foolish to say that we are not impacted by it.  Our children are getting a later start in the world than they might have, had the economy been more secure.  It took much longer for them to get jobs following college graduation than it normally would have.  There have been fewer opportunities to earn money across the board.  There are also psychological ramifications to seeing families you know leaving their homes. It's difficult to know that the place we know, and grew to love, will have fewer inhabitants, and that the character of this place has likely changed forever.
                   Multiple area foreclosures doesn't really help anyone. As the banks finally begin to put up one foreclosed home at a time here, you might think that this would be an opportunity for our kids to buy a home. It isn't.   Banks now require a certain credit rating which is hard to attain when all you are paying that is being reported to a credit bureau, is a student loan.  Some houses can only be financed by certain types of loans which are not easily given to people in the job market less than five years.  I recently found a house I would be willing to aid one of my kids in purchasing.  Apparently, the Obama administration has it in a special program whereby only a first time home buyer can look at it.  I have the credit and financial ability to help my adult child to obtain it, but it can't be shown to me. My adult child can't look at it because she lacks the credit rating which would allow it to be financed under the program the government is requiring the home to be sold under.   Thank you again President Obama.   In a free market system, who are they to tell me I cannot look at or purchase a home in my community which is less expensive than others ?   If I seek to aid one of my children in the purchase of a home, what business is it of theirs ?
                   A friend of mine believes this is just the beginning, that the economy will deteriorate from here. From the number of recent daylight break-ins in our county, he may be right. When I was a young adult, I never knew anyone who had ever experienced a foreclosure.   Now, I know many families who have experienced it, and our eldest kids, have friends who have lost homes in foreclosure.   With all the robberies of homes occurring in the daytime,  it's a good thing this farm is armed.

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