Extreme Makeover Home in Foreclosure

Remember when we talked about the guy who was selling his Extreme Makeover Home Edition home because he couldn't afford to keep it running? Well, another situation has emerged with an Extreme Makeover Home Edition hose and it's even worse:

An Extreme Home Makeover may be going bust. The first metro family who got a new home is facing foreclosure.

A foreclosure notice appeared last Friday, a $450,000 second mortgage they took out less than 15 months ago was in default.

Why did they have a $450k mortgage on the place? I thought these homes were free. A few paragraphs down tells the tale:

Harper told Channel 2 they invested the loan proceeds in a construction business and the business hasn’t been good. She didn’t say how much of the money is left.

Ouch!

Thanks to Matt for the heads up on this piece!

Comments

[Phillip]

This just goes to show that handouts without accountability (like the US welfare system) do not work. This certainly is not Extreme Makeover: Home Edition's fault. These people had a paid for house and made terrible decisions to suck the equity out of the house and invest in an unproven business plan. People should learn to be accountable for their actions. The article was written with a typical "shocker" headline that at first glance makes the TV show look bad.

[justin]

So they got the new home for free from the Extreme Home Makeover crew and proceeded to take out a second mortgage on it? Yikes...that show was much better when they would fix up the people's existing house, but when it turned into "Destroy the old house and replace it with a gigantic McMansion sponsored by Sears" it lost any charm it had.

I always wondered what happened when these families that got the gigantor new home saw their value drop because they lived in a run down or a bad neighborhood to start with...

[Jim]

Its too bad those people squandered the value of their free home.

I'd be curious to see follow up on all the other owners of Extreme Makeover houses. I wonder if more of the owners have problems down the road or if this is just the rare exception.

Jim

[oimcherry]

I had heard a another issue a couple of years ago about an Extreme Home Makeover house.

I'm not sure where the house was located, but with the escalated value of the new home, the residents were no longer able to afford the taxes on the now $1m property they held title to.

I would bet that the utilities bills increased substantially as well.

[Traciatim]

Wow Philip, you read my mind. I came on here just to make a comment that you can't save everyone. People who get themselves in to a mess by bad decisions over and over will always be in the same position. Hand outs do not work.

[Mark]

Rather than shower a single "poor" family with million-dollar homes, other than for medical or handicap reasons, why not help TEN families out with $100K worth of improvements? I know it wouldn't make good television without a plasma TV in every bedroom, or high-end granite countertops and SubZero appliances, but it would demonstrate a more genuine concern for struggling families.

In most of these episodes EHM pays the mortgage, but the property taxes often exceed the annual earnings of one or more family members. One would think that responsible recipients of these million dollar homes would work and live within their means to make it a priority to pay the property taxes. This supports my original point that it would be better to help more families out with more modest improvements than to build the most expensive home on the block by far.

[largebill]

We just had one of these done a block or two from us. Of course, there was the various medical problem sob story, etc. It will be interesting to see how long it takes for them to blow it. I hope I'm proven wrong, but I expect them to make bad financial decisions. Bottom line: A million dollar home doesn't make you rich and you shouldn't spend like you are.

[Kevin]

They took a risk pulling out all that equity and didn't diversify and now it's coming back to bite them. I'm sure this happens many times over but since this is an "Extreme Makeover" home it made the news. Can't really feel sorry for the owners since they got a nearly a half-million dollars handed to them for free.

[Ed]

Maybe Extreme Makeover should hold the deeds to the houses to save the people from themselves, just like the government to bail people out of their home mortgages that they couldn't afford in the first place.

[Eden]

Wow! Someone gets an amazing gift like that and they ruin it with a stupid mortgage. Quite sad.

[sahm]

I agree with Mark. Why don't they just do reasonable makeovers that won't put the taxes out of range or make it incredibly tempting to pull out a second mtg. Even if a house has to be torn down because it is in such horrible shape, at least replace it with something comparable but in much better shape. I have nothing wrong with the private sector wanting to help those that truly need it, but why give them everything? Are they rewarding bad decisions?

It is going to be incredibly difficult to sell this house. Who wants to pay close to a million for a house in the middle of homes that aren't worth more than $100-$150 at most????

[Melissa]

I live in the same county as the home in Port Deposit, MD that was recently featured on Extreme Home Makeover - the father had recently died, and the mom and two teenagers have a horse riding program that helps kids with disabilities.

In our local paper I recently saw an ad for a dinner and raffle to help the family keep the new, expanded facility afloat. I lay a large part of the blame on the show producers - if the family couldn't afford to fix up what they already had, how are they going to support an even larger operation? It's a nonprofit too, if I remember correctly.

I just don't understand what good it does people to leave them with a giant home to maintain when many of the people featured are already having problems making ends meet.

[FMF]

Melissa --

I remember that show! Sad to hear things are hard for them.