I am sorry if I asked too many questions for some of you.

I agree on the attacking people on this blog area. I knew and lived near the lady mentioned and she was one of the nicest friendliest neighbors anyone could have. I feel bad for her and hope she gets a great new start. I also was offered a loan for over $20,000 more than I needed once but turned it down and I am glad I did. I do believe the credit companies are getting a little more careful on how much they loan now. I hope it is not too late for many people though.

Thank you, Zoom.

Try again, garyprimer. Your very first comment is a prime example of the need for active moderation of the comments. At least SarahB had the commen sense to see where that was going.

Mortgage companies focus on real estate loans, banks are much more broad. So yes, there is a difference. Banks are also regulated differently and have different requirements.

And for the record, no one mentions the woman in the story in the first three postings. The fourth poster is the first to mention her.

This is a very serious problem that is affecting the entire economy. I suspect that home equity loans and high risk mortgages are the main reason behind these forclosures and that they are facilitated by the loss of jobs in the area. The lack of availability of health insurance and the high cost of health care (some people are only now finding out what doctors and hospitals have been charging for all these years) is enough to push just about anyone over the edge financially. Feeling sorry for people will not solve their problems and if there is anyone out there who has not suffered personal loss or health problems, you have been very lucky so far.

Correct me if I am wrong, but don't most banks/mortgage companies like to work out a deal with the homeowners if they show the initiative to continue to make payments and provide the banks sufficient evidence that the homeowners will repay what they have fallen 'delinquent' on? That is the experience I have had with other types of loans (i.e. car loans, student loans, rent, etc).

bank - mortgage company no difference.

The bank didn't work with her because her loan wasn't with the bank - it was with a mortgage company.

I do believe the lady in the article stated that she had a serious accident in 1991 and medical bills following that accident. Being in the health care field I can tell you that it does not take long to accumulate bills even if you have health insurance. Without adequate health insurance, or no insurance, those bills could have exceeded $200,000 to $300,000 easily. My heart goes out to this single Mom who it appears did everything right for her family with no issues for 30 years. Shame on the Bank for not working with her!!

i was wondering too, what didnt the bank "work with her on this???"

the story shows you how willing the banks are to work with you. make payments for years, sometime a lot of years, and make a payment late for some reason then to bad. that bad. you think the bank is looking out for you.

It's not just the banks, it's also property tax putting a burden on people. For instance, between my property tax in Milton, the city's 'fee' for trash collection, the Blackhawk Tech levy and the School district, I've seen an increase in my monthly payments just to cover the property tax bill increase almost $100 a month. That deosn't seem like much until you factor in the cost of generally everything rising, and our wages staying the same.

The high rate of job losses in Rock County will obviously coincide with higher foreclosures. I can’t say I didn’t see this coming, but it still unfortunate. I don’t think blame can be placed on this particular women’s story alone for her situation. Health care cost, tuition cost, and other various expenses can exhaust home equity, especially for single parents. However, the mindset of continuing to move into bigger and bigger homes has not turned well for many Americans. Considering most people only use roughly four rooms of a ten room home, it obvious that the 2000+ square foot homes are not always of necessity. In addition, banks made it too easy for people to get locked into lousy mortgages. The combination of high debt and bad mortgages is crippling the home market. I read a story that somewhere Pennsylvania (my memory doesn’t give me specifics) they set up a special task force to handle the high foreclosure rates. The counties (or those in authority) stopped allowing foreclosures and forced banks and home owners to meet and work out reasonable agreements on new loan terms. Official’s part of the task force found that in most cases reasonable terms were worked out and foreclosure was avoided. This kept the local housing markets from free falling, which only causes more problems. I don’t remember all the specifics of the story, but I think a program like this would work well for Rock County.

When I went through Janesville's Homeowners program many years ago, the only option for anyone who took advantage of that program what an ARM. Now, this program is strictly for lower income families who are struggling to own a home. So, why on earth, would they offer an ARM? I was lucky, and was able to refinance prior to the ARM deadline, but many people can't or don't understand why they need to. Believe me, that section of the seminar was glazed over pretty quickly. I hope that part of the program has been changed, because otherwise, it was a great opportunity.

Petunia: I feel for you and your family. I hope life takes an upward turn for you soon. I lost my job (without prior notice) last Thursday. Of course, it happened just as I was back on my feet after being laid off by Rock County in 2007. But I can still count my blessings and hope to be working a new job in the next few weeks (God willing). I will keep you in my thoughts. Best of luck.

For fear of a backlash, I set up a different name just for this subject.

We are about to be one of the sad statistics in Rock County. We do not have a fancy house or great big toys. We do have medical bills, ongoing medical issues, a family crisis and the main bread winner about to lose their job. We have a 30 yr. fixed but had a bank willing to loan more than they should have. Is it our fault, certainly. I also find fault with the bank for doing such a stupid loan. Once the house goes back to the bank, they will never be able to sell it for what is owed on it, especially in Janesville's current market.

It is very sad. We have kids that will have to move, not to mention the stigma that will follow us. But it is our burden and we shall deal with it as best we can.

I feel sorry for the woman who allowed her name to be used. I'm sure she didn't think this would become an attack on her situation.

Everyone's financial picture is different. Don't be so harsh on those of us who were thrown a curveball and couldn't handle it.

when we bought our second house they said we were approved for $20k more than i was comfortable paying for a mortgage. they said i could afford more I said no way I cant . for some reason they dont seem to figure in taxes that are taken out of your check!! seems that way with auto too they want your before tax amount.

Yes, it is especially rough in parts of California. My brother lives near Stockton, Calif., and reports that 1 in 3 homes is up for foreclosure. (Thank goodness, his is not among those.) He told me how that crisis alone has led to a massive downturn in construction, and sales of cars, carpet and floor tiling, furniture, landscaping, etc. Due to the downturn in advertising, this brother was laid off after 25 years as an editor at his daily newspaper. And, the paper, has cut publication to just two or three days weekly. All in a community that grew very, very fast.

Krause is probably a more typical example of a foreclosee in the long run. Rock County never experienced the housing bubble so we probably have fewer examples of the risky subprime mortgages (such as requiring no proof of income) and the ARMs issued in recent years.
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Just the fact that she had three potential buyers for her house in such a short time indicates that the Janesville housing market is not in dire straits (not yet, anyway). She was quite lucky regardless.
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The Irvine (CA) Housing Blog covers one of the hottest spots for the bubble, the risky mortgages, and the collapse. It's a city that now has hundreds of brand-new homes in new subs just sitting empty. Many of the owners walked away. Others desperately tried to save their homes. Those who tried to sell found that there were so many homes for sale the value of theirs had plummeted. The blog looks at many individual examples including the mortgage (and 2nd mortgage) history of a home. It's very enlightening (and unless you really enjoy the schadenfreude, very depressing as well).
http://www.irvinehousingblog.com/

I feel everyone should be responsible for their own actions. However, I feel the banks do own some responsibility in this situation. When we applied for our mortage, the bank kept telling us we could afford way more. They couldn't believe we weren't going to spend what we were approved for. I can see how the average person could get caught up in the moment. It's a stressful time buying a house.

I should have said: "The author didn't make a connection between Ms. Krause' foreclosure filing (which is not uncommon, for all you perfect people out there) and the current high forclosure rates."

Her story sounds normal (as foreclosures go), as apposed to the ARM or easy credit problems responsible for the foreclosure filing rate INCREASE.

What zoom? Ms. Krause's home was under foreclosure. She was an example of the current trend. However, I don't feel she is an example of the typical foreclosure today. I SUSPECT, I do not know, that the vast majority of foreclosure cases involve an ARM or an "alternative" mortgage as opposed to the conventional 15 or 30 yr fixed rate> I also suspect that the home borrowers knew going into the deal that it would be a tight squeeze as far as finances go... but they HAD to buy the Big New House in the nice nieghborhood.
Confusing a high moral standard with a high standard of living is where most young families go wrong these days. They think that purchasing a Nice House will ensure success, and that raising kids with character, marital success, and a satisfying life will all come as a function of buying more STUFF.
Nothing could be further from the truth.

The author didn't make a connection between Ms. Krause' situation (which is not uncommon, for all you perfect people out there) and the current high forclosure rates.

I don't see those as attacks, but as a fair part of the woman's story. Why people are defaulting on home loans is just as important as the fact that they are doing it. She owned the house for 30 years so more than likely cashed out the equity a time or two, as millions of people do. There is obviously more to her story than is reported here. Big mistake, always a big mistake, no matter what, but people continue to do it.

sarah B- i dont see how you think I am attacking anyone. they just wondered how this can happen! that is how. pretty simple no attack. she may have financed their college with the home.

She put two kids through college...she was a single parent.....the house was built in 1978. 1978+30=2008 need I say more

Common on, people. Stick to the focus of the story: the foreclosure situation in Rock County. Please don't turn this into an attack on this woman, whom (by the way) I do not know. These first three comments remind me of the vicious attack on the man who had major heart trouble and needed dental work. Please don't go back down that path.

youre both wrong- i have seen maybe people owe what house if worth now on a mortgage and HAVE lived in it for 30+ years. they just keep refi and cashing out their equity! it is kind of sickining.

I was wondering this as well. If a house was paid on for 30 years, there would not be that much owed on it. Add to that the amount mortgages would be an amount typical of what you paid 30 years ago.. and let's be honest, most Janesville homes are pretty reasonable.
My guess would be this house had either a big home equity loan on it, or a second mortgage. A modest home with 30 years of payments, never late, probably would not command more than $500 in a monthyl payment.

Excuse me, but I have a few questions. How large would a mortgage be on a house built in 1978? How much could a person owe after 30 years of payments? How much were the payments? Do all mortgage companies begin foreclosure because of one missed payment? Is there more to this story?