On the same day the RealtyTrac reports that the nation’s foreclosure filings surged 65% in April to 243,353, Reuters has this wild tale of one man responsible for nine of those foreclosures.
Shawn Forgaad, software product manager from Santa Cruz, Calif., says he speculated in a major way during the boom, buying nine houses with Pay Option or negative amortizion loans. Now his house of cards is crashing down.
One out of every 519 homes nationally received a foreclosure filing in April, RealtyTrac figures. Some 53,000 were repossessed. The country, meanwhile, marches on to what could be one million foreclosures for the entire year. Washington debates what to do to fix the mess.
California cities account for six of the ten U.S. markets with the highest foreclosure rates. Forgaad, the speculator, says he’s learned his lesson and is moving his family to lower-cost North Carolina where they can start fresh.
“On the surface it looks like total devastation but it’s just the opposite,” Forgaad told Reuters. “I’m confident our lives will be much, much richer as a result.”
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.