Though signs of recovery in the housing market are emerging, thousands of people throughout the Southland are still in a precarious position on the brink of foreclosure, struggling with monthly bills and mortgage payments.
Duchemin and Ashraf are an extreme example because they've gone through foreclosures on two homes and are in danger of losing a third. They aren't alone: Flimsy lending practices mean that thousands of other borrowers face the prospect of repeated foreclosures, mortgage and foreclosure experts said.
The problem is especially visible in areas that attracted speculative buyers during the boom. In Maricopa County in Arizona, which includes Phoenix, at least 283 individuals have received a foreclosure notice on two or more properties since 2006, according to data provided by RealtyTrac Inc.
Multiple foreclosures are "probably more common in this decade than they've ever been because everyone was running to get into the real estate investing business," said Rick Sharga, a senior vice president at RealtyTrac.
Clark County in Nevada, another area that attracted house flippers, had at least 179 buyers who were foreclosed on more than once over the same period, the data show...
Because people thought the price of real estate would keep climbing, O'Toole said, they figured that the more homes they bought, the more they'd earn eventually.
"In a lot of cases, you had folks in this gold rush mentality: 'Real estate is going up, the more houses I buy, the more money I'll make.' "
The article mentions "flimsy lending practices" but doesn't explain how the lending industry came to offer easy credit in which speculation was encouraged. Instead, it builds sympathy for the Duchemin's without really looking into the big picture, like the politicization of the mortgage lending industry in which lenders were coaxed into providing credit to borrowers it would never have under normal circumstances. Why anyone would lend the Duchemin's funds for three homes is beyond me. Also, notice how the article never mentions the Duchemin's bad decision to "buy" three houses?