Aug 5, 2009
Housing Bulletin
A Foreclosure with a Happy Ending
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.
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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
Posted at 08:57 AM in Housing Bulletin | Permalink
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Reader Comments:
Great article about people turning things around for themselves, creating new beginnings in the face of adversity. I think these difficult times are testing a lot of people's mettle, and they're figuring out what they're made of. Thanks for sharing it!
Funny, in order to post a comment I had to solve some simple arithmetic. What is 6 + 8 = 14. Perhaps, we should have potential home buyers perform simple arithmetic before they can purchase a house?
Being approved for a loan you can't afford then blaming the institution, the market, all these external forces, says that you are incapable of thinking for yourself. These people should have done the math and not attempt to live outside their means.
I feel bad for them but they should have gone with sure thing (400k house - you know you can afford even in difficult times) rather than the gamble.
You folks took a gamble on the market and lost - pure and simple. It happens all the time.
Can I have a story about my family's resilience for bouncing back after we endured some stock loses? Can I live rent free in a beautiful house, in a beautiful part of the country because of my loses? No. Maybe I need to start a blog, right?
Finally, if a city official gives you approval to jump off a high bridge would you do it?
“…and even the rueful memory that one night in the midst of their financial mess, they cavalierly ordered a $60 lobster dinner.”
At least they have some moxy! I’ll give’em points for that much. :)
"Stephanie and Bob Walker camped out in the Barrington home of Stephanie’s mother."
Oh, and I hear the camping in Barrington is rough! Only macchiatos with regular milk. Sorry, no soy milk cappucinos. :(
Such negative comments, Schad. What a pity. You mustn't be a happy person. I suppose every decision you ever made in life was a good, safe one. Never had a problem. I found the Walker's blog since I live on San Juan Island. To read their blog, from the beginning, is very uplifting. I couldn't help but admire this couple for doing what they needed to do. Getting rid of so many memories that were connected to their personal belongings had to have been the most painful experience. (they have a slide show of the things they sold) I truly believe that their upcoming opportunity on the island will be a rewarding experience. They deserve it.
And Schad., I suppose you have been approving of all the gambles taken by our "institutions". I suppose all your investments are not at risk. So glad things are working for you. But, a vacation out here to our paradise probably wouldn't be enjoyable for you. People here don't point a finger, they ask, "How can I help?"
I truly believe that their upcoming opportunity on the island will be a rewarding experience.
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