With 10,000 Americans going into foreclosure everyday, the housing crisis has produced millions of heartbreaking stories across the country. Earlier this week, Arianna asked readers to share how home foreclosures have affected them or their loved ones. We've received many heartfelt responses.
We'll be publishing your stories every weekday as the crisis continues, showcasing one person's voice to represent the 10,000 who will be foreclosed on that day. Have a story on how a home foreclosure has affected you, your family or your friends? Send it to us at submissions+foreclosure@huffingtonpost.com, and sign up here to receive updates on the feature as it progresses.
Our first story comes from Connie in Queen Creek, Arizona, only twenty miles from the school where President Obama today announced his $75 billion plan to provide relief to homeowners facing foreclosure:
I always thought of home ownership as more than just a roof over our heads. It was a way to provide for your family, earn equity, and could NEVER be a bad investment. That has all changed. My husband's job brought us to Arizona in June, 2005 from Colorado, where the housing market wasn't as booming as it was here. We had to sell our house in Colorado, move everything into storage and move in with family. See, the housing market was so hot then, that no one was accepting contingency offers. In fact, people were getting into bidding wars. It didn't take us long to figure out that a home listed for $200,000.00 could easily be sold for $300,000.00. Homes would be on the market, not days, but hours. So...imagine our surprise when we found one that had been on the market for 11 days. It had everything we needed: 3 bedrooms and a den and in a good school district. It wasn't fancy...only 1700 square feet, but it fit our needs. We snatched it up for $250,000.00. We were moved in within 3 weeks of placing an offer.
Six months later, our home appraised for $312,000.00. I couldn't believe it. My husband thought, "why not refinance out of our interest only loan and pay off some bills." So we did. We refinanced for $280,000.00...but our interest rate was unbelievable...9 1/4 %! Our payments were $2550.00 a month. There was a two year prepayment penalty on our loan, but we assumed (incorrectly) that the worst thing that could happen would be for the market to plateau in 2 years...we never imagined it would bottom out. It did. We are unable to refinance our mortgage because the current value of this house is $145,000.00. We have been trying since May, 2008 to modify our loan to no avail. The mortgage company would rather we foreclose than work with us. See, I work for a school and am not paid over the summer. My husband's commissions dropped significantly in 2008 and we found ourselves making ends meet with credit cards. In October 2008, we made the decision to play hard ball and stop paying our mortgage payments. The bank refused to talk to us unless we were 106 days behind. When they did, they explained it's better to pay the mortgage than the credit card bills. Ordinarily, I would agree, except when your house is worth 1/2 of what you owe on it. We saw a HUD housing counselor, twice. Needless to say, the mortgage company has refused HUD's recommendations twice. They have turned us down for hardship three times. Recently, upon a referral from our mortgage company, my husband met with ACORN [Association of Community Organizations for Reform Now], in January. Their recommendation was to lower our interest rate. While we're really looking for a principle write down, we'd take a lower interest rate if it could make our home more affordable. The unfortunate thing is, the bank is not approving this course of action either. Additionally, weeks went by without a reply from Acorn after numerous attempts to email them as their phone number had been disconnected. I have to tell you....that was frustrating! Aren't they supposed to be our advocates?Our mortgage company is now considering offering us a Deed in Lieu of foreclosure settlement instead of straight foreclosure. I would still venture to guess it would've been cheaper for everyone if they would have worked with us instead of against us. This has been a nightmare. I kept thinking that surely we'd qualify for the FHA loan (which we do, but Beneficial or HSBC won't accept it). How many more hoops do we need to jump through? This has been a painful lesson. One, purchasing a house is not always a good investment and two, never make a loan that has a prepayment penalty...ever. We're looking at an auction date of May 6th...if the bank doesn't accept a deed in lieu of foreclosure. I don't think any plan DC can put together will help us. I can only tell you that people here need principle write-downs. Temporary hardship modifications and interest rate reductions will not help.
We feel absolutely lousy about this. Not only because we're losing our home, but also because we have great neighbors who will surely be affected by another foreclosure in our subdivision. I hope something can be done so others can avoid going through what we've gone through.
Connie is not alone. In 2008, 2.3 million Americans faced foreclosure proceedings, and Obama believes that 9 million families could face foreclosure in the near future. Share a story of how the housing crisis has affected you by emailing submissions+foreclosure@huffingtonpost.com. And sing up here to receive updates when we publish new stories.
For more testimonials from people facing foreclosure, take a look at Brave New Foundation's new site, Fighting For Our Homes. Or watch their latest informational video, featuring interviews with Ohio Rep. Marcy Kaptur and economist Dean Baker.
Find out more about Dispatches from the Displaced, HuffPost's Eyes&Ears series of reader-submitted foreclosure stories.