(post by BT) Today I met with a lady whose home is going into foreclosure. She has a 2-family house and both tenants haven’t been paying rent. Bought in 2005, at the peak of the pricing bubble with a 9% mortgage interest rate! She makes only $2,000 per month and put only 10% down. Only the bank somehow hadn’t anticipated this type of mortgagors to fall on their faces. After finally evicting the bum tenants, she missed 6 months of payments and by then the procedure was well on the way. She contacted a lawyer who told her to file for bankruptcy. She tells me she does not want to loose the house and is going to rent it out again, but only to people from her own background (which is a serious discrimination suit waiting to happen!) I explain to her “you will rent it and still be thrown out in 6 months. What’s the point, and how fair is it to the tenants?” No, she’s not going to loose her house, she insists. You’re not?!! How will you pay back the $27,000 you owe them? “I will refinance!” What?! Who is feeding her these lies and empty promises? The lawyer, of course - the same one charging her $250 per hour. What the hell?! You have no income, no credit, zero equity - no one will lend you money. Not any more. She says the lawyer knows someone who will but they charge 12% interest!!! Oh god, help this stupid lady, please. She is brain-dead. Delusional, for sure: “My dream for the past 30 years is to own a property, and I won’t let go.”

With her high blood pressure and low income, 350 lbs of body weight and negative net worth, no family and difficult tenants, this time next year she is more likely dead than still in this house.

Though of the day: Is this a weak market, or finally a normal one, after a few years of bad advice and severe overpricing?