NY Times misses the real story – NY Times is running a sob story about an unemployed union roofer losing his house in Philadelphia (Story), painting Bank of America as the bad guy, and the City of Philadelphia as the good guy with its anti-foreclosure program.
On the third page, the facts come out. His mortgage is $63,000 (after he “pulled money out” of his 4th generation family house in the 1990s)…. but his mortgage payment is $950 a month… It doesn’t mention the rate on his mortgage, but let’s guess it is 8%. That would be $420 a month…. what is the other $530 a month? City Property Taxes and insurance. Even if the interest rate was 0%, he can’t afford the house on an $800/month unemployment check.
Thinking a bit more – all of these programs to suspend foreclosures means escrow accounts to pay taxes are going to be unable to cover the tax bill – which will fairly quickly put the City as the bad guy forcing foreclosure.
Why in all of this talk aren’t the cities offering to renegotiate property tax rates? (Yes, that was a rheturical question)