Extreme Makeover doesn't pay for/pay off the houses they build? vol read the fine print

[datznasty]

The house they did here in my hometown is in foreclosure and it's near impossible to sell because it's so custom. The entire family is handicapped soeverything is wheelchair accessible and the counters they say are like 2 feet high, things like that.

It's something they don't even talk about in the show, you just assume it's taken care of, that they pay for the house they build and take care ofthe previous standing one's payments if necessary. But it's not the case at all.

So I was looking on Google to see if I can find some pics of it, and turns out this happens to damn near all the houses.

That's %$$$%% on ABC's part though.

Here's an article about one
http://blogs.wsj.com/deve...me-may-face-foreclosure/

It looks like yet another "Extreme Makeover" home is in trouble, this one in Oak Park, Mich., near Detroit: Judy and Larry Vardon, struggling witha hefty mortgage payment and medical bills, worry that foreclosure is a possibility, The Associated Press reports.

The Vardons, who are deaf, were featured on the popular television show about four years ago. Millions watched as their 980-square-foot house wastransformed into a dream home with cameras and flat-screen monitors that let them monitor Lance, their blind and autistic son.

Post-makeover, the couple refinanced the mortgage, and their monthly payments skyrocketed from $1,200 to $2,300, accordingto the AP.

Things are tense as they work to modify the crippling 11% mortgage rate. "I'm afraid I'm going to lose my house now," Judy Vardon isquoted as saying via an interpreter. (Of course, mortgage modification doesn't always improve the situation.)

It is becoming an all-too common scenario: Popular television show finds a heart-string tugging family with a modesthome that is quickly transformed into a McMansion. But the families can't always afford the supersized bills - the Vardons's property taxes soared morethan 50% - so tapping the new home's value becomes tempting.

In July, we wrote about a Georgia familythat used its new home as collateral for a $450,000 loan to finance a construction business that failed. That loan was modified this summer, Chase, themortgage's servicer, said Tuesday morning.

In Florida, Sadie Holmes, another recipient of an Extreme Home Makeover, foundherself overwhelmed by code violations that resulted in her being slapped by a $29,000 lien on herproperty, which includes a 7,000-square-foot home and office for her charity. The status of her plight is unclear. -DawnWotapka[/quote]
[/quote]

 

[datznasty]

[h1]When Big Houses Enter Foreclosure: Extreme Makeover Home Edition Goes Sour[/h1]
by Silicon Valley Blogger on August 8, 2008

Big houses are really nice, if only they weren't so costly.

It won't be long before the iffy real estate market will be fertile ground for bargain hunters, if it's not the case already. But recently,there's been quite some buzz about the latest high-profile foreclosures to hit the news: those homes that were given away for free through the Extreme Makeover HomeEdition show.

The Extreme Makeover program makes for great reality tv by providing "free" custom-built homes to families that have been hard on their luck inorder to give these families a fresh start. But unfortunately, for a couple of these home recipients, their change of fortune doesn't stick and theypromptly lose their homes to the banks. Some details of these cases, along with my thoughts:
[h3]How Big Houses Can End Up In Foreclosure[/h3]
#1 The Harpers' Story

In particular, this magnificent Extreme Makeover home owned by the Harper family is onesuch casualty of foreclosure borne of poor financial decisions.

From thestar.com:

In Clayton County, Georgia, more than 1,800 people showed up to help ABC's Extreme Makeover team demolish a family's decrepit home and replace it with a sparkling, four-bedroom mini-mansion in 2005. The finished product was a four-bedroom house with decorative rock walls and a three-car garage that towered over ranch and split-level homes in their Clayton County neighbourhood. The home's door opened into a lobby that featured four fireplaces, a solarium, a music room and a plush new office.


What's more, the house cost $450,000 to build, with reports also stating that Beazer Homes raised an additional $250,000 for the Harpers, in order to coverscholarships for the family's kids and to help defray maintenance costs and property taxes for the home. It turns out that after such a tremendous bountyis showered upon grateful and lucky families such as the Harpers, these folks are sent along their merry way. They are on their own financially, after the showbestows upon them a gold mine that turns very quickly into a money pit.

ABC said in a statement that it advises each family to consult a financial planner after they get their new home. "Ultimately, financial matters are personal, and we work to respect the privacy of the families," the network said.


How could fortunes change so drastically in three years' time?

#2 Jessica Boey's Story

One other Extreme Makeover home is lost to foreclosure due to a death in the family:

Ty Pennington and his team built Jessica Boey a new home to help her during her fight with cancer in October. Boey passed away in late December and now, the family is struggling to pay for the expensive new home.

There's still $250,000 dollars left on the old mortgage that they have to pay, plus they're paying property taxes for the value of the new home because it's worth more than the old home was. On top of that, utility bills now cost anywhere from $500 to $700 dollars a month.


Was this something that could have (or should have) been prevented with adequate financial preparation?

In an earlier post I wrote about the Extreme Makeover HomeEdition show, I stated that the idea behind the television program is wonderful, but I've expressed my skepticism over its whole premise, and wonderedwhether the show's participants are really prepared to own and maintain such elaborate homes (or mansions). Were these people ready to receive suchgenerous gifts? I'm sure many are, but this doesn't alter the fact that those who experience a sudden change in fortune often find themselves in avulnerable situation: when you're steeped in financial difficulty and suddenly receive a massive windfall, you're susceptible to financial stress. Without some solidfinancial guidance and direction (even intervention!), those in this quandary can eventually find themselves back to square one.

Stories like these just emphasize the importance of fostering money management skills in ourhomes and schools.

http://www.thedigeratilif...ts-home-ownership-costs/

 

[lurkin2long]

damn...........................there is always a catch.

nothin is free in this world.

 

[thytkerjobs]

not surprised

 

[dirtylicious]

That's %$$$%% on ABC's part though.

why though? they do NOT pay off the current mortgage of the home...they fix it up... which in turns creates greater equity (and most likelygreater than the value of the original mortgage)

Post-makeover, the couple refinanced the mortgage, and their monthly payments skyrocketed from $1,200 to $2,300, according to the AP.
eh...they refinanced to get money out of the house.
From what I've read...it's not Extreme Makeover's fault that people get greedy with their gifts.

and the code violations one?...that was AFTER EM was there.

The violations began to accumulate after Holmes, a former drug addict and single mother of five children, moved into the home and received permission from Seminole county to run a volunteer organization from it. Sadie Holmes Help Services collects clothing, food and furniture and distributes them to people in need.

Running the organization from the property required that Holmes screen from view any materials stored outside, the paper said. By September 2007, the Sentinel reported, a code-enforcement officer began filing violations for overgrown grass and because such things as portable restrooms, an over-sized truck and abandoned vehicles were allegedly stored on it in full view Holmes said she began receiving visits from the officer as early as two months after she moved in.

oh..and I believe EM does create a fund for the homeowners to pay for the new taxes.

 

[not a sneak]

Isn't it the same thing on "Pimp My Ride"?

 

[jthagreat]

wow that sucks. ABC prolly like F!!! it, it makes for great TV and bounce.

 

[lazy b]

This was revealed a couple of years ago if I'm not mistaken.

 

[e3lal]

Originally Posted by Lazy B

This was revealed a couple of years ago if I'm not mistaken.

Ya I remember that too

 

[e3lal]

Originally Posted by Lazy B

This was revealed a couple of years ago if I'm not mistaken.

Ya I remember that too

 

[datznasty]

why though? they do NOT pay off the current mortgage of the home...they fix it up... which in turns creates greater equity (and most likely greater than the value of the original mortgage)

Because they use these people to create this warm and fuzzy story, make it look like they're doing this great favor, and it only improves the quality oflives of the recipients short term. A few months later you're left with higher utility bills, higher mortgages, and a house too custom to be worthanything. Like the case with the Lawton house here, who is going to buy a house with 2 foot high countertops?

That was just the first 2 articles I could find on it, but if you look into it, it's far from being isolated incidents.

While I agree, the person trying to capitalize on the home's increased equity and failing and the case where one of the family members passed are outsideof their control, you'd still assume they take more care of them than to just give them a house and be like, "figure it out," now regarding howyou're going to manage to maintain it.

 

[nktran001]

Originally Posted by thytkerjobs

not surprised

 

[dirtylicious]

Originally Posted by DatZNasty

why though? they do NOT pay off the current mortgage of the home...they fix it up... which in turns creates greater equity (and most likely greater than the value of the original mortgage)

Because they use these people to create this warm and fuzzy story, make it look like they're doing this great favor, and it only improves the quality of lives of the recipients short term. A few months later you're left with higher utility bills, higher mortgages, and a house too custom to be worth anything. Like the case with the Lawton house here, who is going to buy a house with 2 foot high countertops?

That was just the first 2 articles I could find on it, but if you look into it, it's far from being isolated incidents.


1. how is a higher mortgage EM's fault?
2. too custom?...nothing is too custom that cant be undone. Plus, the value of the rebuilt homes are usually far greater than the original mortgages...it's not like there isn't some kind of automatic equity there

...how is rebuilding someone's home NOT a great favor?

While I agree, the person trying to capitalize on the home's increased equity and failing and the case where one of the family members passed are outside of their control, you'd still assume they take more care of them than to just give them a house and be like, "figure it out," now regarding how you're going to manage to maintain it.
I would probably assume that the recipients are all given some type of advice on what to do with their newly given gift, eg consult a financialplanner.
so the saying goes... you can only lead a horse to water... you can't make em drink.


I don't see how you rest this largely on the shoulders of EM... I would think you would rest this on the shoulders of the owners more than EM.

 

[mastamind89]

Not surprised at all, this is the same thing that happened to the people on Pimp My Ride, their insurance went up.

 

[food4thgt]

^^ exactly

 

[damnneardeadstock]

I think the OP is more mad at the fact that they are using a family's tragic story to play on the hearts of viewers, just to boost ratings, when in theend, they aren't helping the family at all. They're in a sense making it worse for them, simply using them, when if they really cared about them, theyjust woulda gave them money to help them.

 

[derek916]

how did EM do them a favor for building them a new house? All they did was decide what they thought was best for the house and than hired some workers to maketheir fantasy plan a reality. I never heard of these house designers before and seeing how EM is so cheap they were probably intern designers.

 

[datznasty]

1. how is a higher mortgage EM's fault?
2. too custom?...nothing is too custom that cant be undone. Plus, the value of the rebuilt homes are usually far greater than the original mortgages... it's not like there isn't some kind of automatic equity there


It's not a huge favor because they can't pay for it, most of them can't pay for the house they are already in. And would you really buy a nicehouse in a decent at best neighborhood, only to have to almost completely gut the inside because you don't have the need for wheel chair ramps, 2 footcountertops, and whatever else Em did?

Can we at least agree they could have checked to be sure what they are doing doesn't violate building codes?


I'm going to send this to Channel 7, see if they can't have some kind of telethon or create some sort of event to help raise them the money to keep it.There's some high rollers in town who would probably love to help out if it meant getting face time for it, especially the dude who owns the CBA team here.

And I didn't know Pimp My Ride was the same. I assumed the shop did it for free in exchange for the extra publicity they get from being on MTV. Iwouldn't even be on the show then. So not only do you want to install a blender in my car and integrate it to the dash controls, but you want me to pay forit too? Why not just give me the damn blender, and maybe a power inverter?

 

[alchemiss]

What do you guys mean by "revealed"? Of course the equity will go up. Home owners should know their payments will go up when their homes are muchlarger and nicer. This thread is -_-

 

[mjsaver]

wow, thats messed up.

I blame EM 1st and foremost, they know these faminlies are in tough financial situations.

They give the appearance that theyre solving all the families problems.

Why not just make A FEW MODEST IMPROVEMENTS TO THE HOME

 

[heliumclinton]

I use to want to get selected for these type of shows, what's the point if I have to pay?

 

[mjsaver]

wow, thats messed up.

I blame EM 1st and foremost, they know these faminlies are in tough financial situations.

They give the appearance that theyre solving all the families problems.

Why not just make A FEW MODEST IMPROVEMENTS TO THE HOME

 

[greenbean]

what makes it so bad is im in my senior year in high school and the Extreme make over episode that came on week before last was one of my good friends thatgoes to my school here in Florida and i was talking to him about the whole thing and he said that there family is looking to move out already cause its to highto stay there

 

[grizzlyboy]

YES THEY PAY THEM OFF!!!!

The idiots who get them take mortgages out for the cash value and can't afford it.

idiots....

 

[chi ill]

Originally Posted by Alchemiss

What do you guys mean by "revealed"? Of course the equity will go up. Home owners should know their payments will go up when their homes are much larger and nicer.

Exactly , the only people that didn't know / shocked by this probably didn't know too much about mortgages anyway .

If your house is larger , bigger payments . That's common knowledge .

How is one going to want a bigger house but can't expect to pay a little more ?

They should be happy that they got their whole house renovated for free , paying for nothing .