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A Foreclosure with a Happy Ending

Three years ago, Stephanie and Bob Walker paid $799,000 for a three-bedroom house on a ridge in the Silverlake section of Los Angeles with a view of the Hollywood sign and the Griffith Park Observatory. This summer, they were camped out in the Barrington home of Stephanie’s mother, having lost a yearlong struggle to hang onto their house in…


The view from the Walkers’ three-bedroom house on a ridge in the Silverlake section of Los Angeles takes in the Hollywood sign and the Griffith Park Observatory.
 


Stephanie and Bob Walker camped out in the Barrington home of Stephanie’s mother.

Three years ago, Stephanie and Bob Walker paid $799,000 for a three-bedroom house on a ridge in the Silverlake section of Los Angeles with a view of the Hollywood sign and the Griffith Park Observatory. This summer, they were camped out in the Barrington home of Stephanie’s mother, having lost a yearlong struggle to hang onto their house in L.A.

Without flinching and with little whining, Stephanie recounts the whole ordeal at her blog, Love in the Time of Foreclosure. She describes the shock of realizing that she and her husband couldn’t cover their house payments anymore; the labyrinthine details of their interactions with the bank while trying to get a loan modification; and even the rueful memory that one night in the midst of their financial mess, they cavalierly ordered a $60 lobster dinner.

The Walkers’ story isn’t all that unusual. Optimistic buyers and relentless renovators (they spent an additional $130,000 to fix up the place), they paid big for a house that seemed destined to go up in value. “We thought we were doing the right thing when we bought the house,” Stephanie told me. “The day we saw it, it had just been lowered in price by $100,000. We looked at that view and thought, ‘We can’t go wrong.’”

Bob tells it a little differently. “We were selling a $200,000 condo,” he recalls, “and looking at $400,000 houses. We ended up stretching for an $800,000 house, but we got approved for [the mortgage], and I was making really good money [as a computer programmer]. Everybody was saying we could do this, so we took a leap of faith.” Their monthly mortgage payment was about $5,000.

In June 2008, when the Walkers had been in the house for about 20 months, Bob’s contract was canceled, and within a very short time the house became unaffordable. The couple received their first notice of foreclosure proceedings last December, and in June 2009 they sold the house for $700,000 as a short sale (where, with the bank’s approval, a house is sold for less than the money owed on it).

That ended a long stretch that Stephanie today calls “an extremely depressing and really scary ordeal.” The couple packed up a few duffel bags of belongings and their bikes and drove to the Barrington home of Stephanie’s mother by way of Bob’s Iowa hometown. “We learned we’re resilient,” Stephanie says. “We learned not to be so attached to material things. We learned that we have each other.”

And the Barrington stay turned out to be not so much an ending as an intermission. By the time they got there, the Walkers, thanks to a contact made through Stephanie’s blog, had nailed down a deal to serve as rent-free caretakers at a home on the San Juan Islands off Washington State.

“It’s not really an ending,” Bob says. “Getting in the car and driving away from our house was like an end in a chapter. But that opened up a whole new chapter for us, a whole new life. It was hard for us to let go of that house, but as soon as we did, something else showed up.”
 

photography: courtesy of Stephanie Walker

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