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A Most Extreme Makeover Equals An Even More Extreme Foreclosure

Unfortunately, No Good Deed Ever Goes Unpunished

In January 2005, Beazer Homes spearheaded the most intensive makeover in ABC’s Extreme Makeovers history at that time - completely demolishing the Harper family’s modest home in Lake City, GA - and building a 5385 sq. ft. mansion in its stead.

This ambitious project was completed in an unbelievable six days, using the talents of more than 1800 people - and the finished product was a beautiful four bedroom, four and a half bath home that included a home office, solarium and music room.

In addition to the construction of this new home - valued at $450,000 - Beazer Home’s employees and company partners raised an additional $250,000 in other contributions for the family including scholarships for their three children and a home maintenance fund.

That was 2005. Times were good for the Harpers. They were handed a mansion worth hundreds of thousands of dollars more than the home they were paying for… the home they bought for $120,000 back in 1999. Wouldn’t you like to live in a $450,000 home while paying a $120,000 mortgage?

Fast forward to July 2005 - the Harpers refinanced their FHA mortgage, adding another $10,000 to their mortgage balance. Not much of a cash-out refi, there. But in Sep 2006, they did do a cash-out refi for $300,000. Then another cash-out refi in May 2007 for $450,000. The couple reported to WSB-TV that the loan was for a construction business that failed.

Now the home is scheduled for auction on the Clayton County courthouse steps on August 5th - where I predict no one will step up with an offer anywhere near the $450,000 price tag. Why? Because it’s nowhere near a home worth half that price.

Just look at the difference in size with the neighbors.

Now, all the Internet is a buzz about how this family is a victim of the foreclosure crisis. May I submit another take on this? The only victims in this story are all the volunteers who helped with money, sweat and tears giving this family a home they would otherwise never had… JP Morgan Chase who foolishly loaned this much money using this property as collateral… and the U.S. taxpayer - who, one way or another, will wind up paying for this.

The Harpers are NOT the victims, here.

Hat tip to the Phoenix Real Estate Guy for the heads up.

As always, if you have any questions regarding real estate in the greater Atlanta area, feel free to contact me here.

Posted by Doug Quance on Monday, July 28th, 2008 at 10:18 pm.

10 Responses to “A Most Extreme Makeover Equals An Even More Extreme Foreclosure”

Excellent analysis Doug, and I agree completely. People need to be a little fiscally responsible and not use their home like an ATM machine.

I’m sure it’s lovely, but that home is completely out of proportion for the neighborhood.

Left by Jay Thompson on July 29th, 2008

Doug

As I said in my post on this, what makes it even more gruesome is that the homeowners had their previous home mortgage paid off and were given 100,000 dollars to boot.

They are getting what they deserve.

Left by Tom on July 29th, 2008

>Thanks Jay. It really IS out of proportion.

>Tom: I must have missed your tweet about this… the comments are worth the read, too!

Left by Doug Quance on July 29th, 2008

[...] Here is a GREAT post by Atlanta area agent Doug Quance — (this home is in the Atlanta area) with much more detail than you’ll find in the [...]

Left by Foreclosure Looms for “Extreme Makeover” Home | The Phoenix Real Estate Guy on July 29th, 2008

[...] far, Washington has put its political capital into trying to refinance salvageable homes for unsalvageable homeowners, when a relevant policy would consist of judiciously buying unsalvageable houses and demolishing [...]

Left by Tear ‘Em Down | Real Central VA on July 30th, 2008

[...] Advice: Don’t look a gift horse in the mouth, and don’t get an adjustable-rate cash-out mortgage on a house that was given to you as an act of c… Yeah, the Extreme Makeover house is now going up at auction. Thousands of people volunteered to [...]

Left by Secretly Ironic » Blog Archive » Underwater: Two Quick Links on July 30th, 2008

You commented on the BloodHoundBlog and i follwed your link to your site. I really like your blog! If you are ever interested in exchanging blogroll links let me know!

Left by Jeffrey Buettner on August 6th, 2008

It’s just sad to see how people misuse the blessing that they were given…is it a bank repo now? If so, how much is it listed for?

Left by Jay Valento - Long Beach real estate on August 21st, 2008

>Jay: It usually takes a couple of months between the courthouse steps and the MLS, here in Georgia. My uneducated guess is a list price around $300K and a sale price of around $250K.

Left by Doug Quance on August 21st, 2008

Maybe I should be buying in Georgia instead of California…that home would be over a million here in Southern California.

Left by Jay Valento - Long Beach real estate on August 21st, 2008

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A Most Extreme Makeover Equals An Even More Extreme Foreclosure

10 Responses to “A Most Extreme Makeover Equals An Even More Extreme Foreclosure”