Starting Over…

Lately I’ve been encountering a number of people who are being forced to start over in life, many with little or nothing to show for their time up to the present. That can be particularly disturbing when these are people in their 50’s and 60’s. Most, through no real fault of their own, have found themselves out of work and about to loose their homes, after decades of successful living. Some certainly contributed to their own problems by over-spending or over-reaching for the American Dream of home ownership, but most are just innocent victims of an economy gone terribly awry.

As I talk with these folks I sense a lot of emotions bubbling below the surface – fear, anger, frustration – all jumbled up. There is certainly fear about what happens now – how to start over at a late age with no home, no savings (many depleted their savings trying to save their homes) and in many cases no jobs. There is anger, but with no real focus. Who do you get mad at for what has happened to the economy that swept you along with it? You can only beat yourself up so much for what were in retrospect maybe some poor financial decisions.

And there is certainly plenty of frustration to go around. There is so much conflicting advice about what to do or not to do; and many of these people have tried the frustrating experience of trying to work things out with their banks. I have one client who has shared with me his frustration of just being able to find someone to talk to at his bank for whom English is a first language. It’s bad enough to have to try to explain your hardship situation to someone who understands English, much less trying to find understanding from someone half a world away for whom English is a second language that they are still learning.

It is also frustrating to most to be told that in order to be considered for help they must already be in pre-foreclosure – in other words, the banks are saying don’t even call me to discuss modifying your loan or a short sale unless you are already 2-3 payments behind. By the time that they will talk to you, most banks have already put you on the road to loosing the house. And most lenders are still not cooperating on short sales, since that means they must agree to take a loss, before they’ve even foreclosed on the property. Many are also still pursuing deficiency judgments against the mortgage holders for the balances.

I suppose that it is that sense of frustration that is driving so many to seek the protection of bankruptcy. I advise against that, until it is the last resort, since going through bankruptcy seems to have the most negative impact on ones credit and takes the longest to recover from. So, I spend quite a bit of time these days trying to find places for these people to start over in – rentals, leases, and land contracts. There is something uniquely sad about showing a 50-60 year old couple who just lost their McMansion to foreclosure through a 1,200 Sq Ft, 3 bedroom 1 bath rental home and listening to them discuss how they could live there until they get back on their feet.

For many the realization that they will never get back to life as they knew it has set in, but for most this is viewed as a temporary setback and they even talk of buying the place as a rental unit when they get back to the life that they are used to. Hope springs eternal and that's a good thing. We all need hope, which for many of us is bolstered by faith. We may have to start over and that is disappointing; but, it is also a bit exciting, too. After all, it is out of struggle that one eventually finds rewards. Wow, it's a good thing that Pollyanna was here to save this otherwise dreary post. So, call me and let's get you started over again.