Apparently a family in Georgia got a free house in 2005 from Extreme Makeover, and now they are going into foreclosure here. So what happened?
Well 2 years after Extreme Makeover rebuilt the new home for the Harpers and paid off their exisiting mortgage, the Harpers took out a $450k mortgage only 15 months ago! And somehow in 15 months are already going into FORECLOSURE! Along with being given a new home the Harpers were ALSO give $100k in cash to help with new expenses from the sponsers Beazer Homes.
What happened? How did this family go from debt free and $100k in the bank to foreclosure in less than 3 years?
I can only guess a few things. One, this family got a new house and all this money but had no idea what to do with it. So they went on a spending spree and starting buying new cars, new furniture, etc and thus had to remortgage their new house! Of course they got a mortgage WAY more than they could ever afford. I mean they couldn’t afford their old run-down home, how could anyone imagine they could afford a new $450k home?
Two, they probably had no idea what it costs to maintain a much newer, larger home. The property taxes were probably triple what they were used to. The new utilities were much higher because the home was so much larger. So a couple who were bad with money were given a get out of debt free card without any help.
I guess this is a new twist of lottery winner or people who get rich fast and lose it all quickly as well. I think that Extreme Makeover needs to stop giving people free homes who cannot afford them. I wonder if other Extreme Makeover recipiants are as badly off?
11 responses so far ↓
1 dogatemyfinances // Jul 27, 2008 at 9:10 pm
Wow, a $450K second mortgage on their free house. I can’t even contemplate what that family could need that much money for. I agree, like winning the lottery. Wheee!
2 Andrea // Jul 28, 2008 at 10:15 am
It said in one of the articles I read that they put their money into a construction business and the business was not doing well.
3 devil // Jul 28, 2008 at 10:19 am
This is why throwing money at people just doesn’t work. Whether welfare or the lottery - if someone doesn’t know how to handle money, giving them more won’t help them.
What a waste. Extreme Makeover could have donated to a worthy charity and helped a lot more people. Instead they just enabled spending addicts.
4 frugal zeitgeist // Jul 28, 2008 at 10:59 am
Holy COW.
Having said that, this shouldn’t really be a surprise. One of the problems I have with Extreme Makeover (full disclosure: haven’t seen it in several years) is that the gargantuan, fancy-ass houses they build have significant upkeep costs. For a family that already has trouble making ends meet - as many of the families helped by this program do - receiving a new house that’s unaffordable to maintain is tantamount to setting them up for failure.
5 LivingAlmostLarge // Jul 28, 2008 at 11:30 am
Doesn’t matter what they did with the $450k, that is a lot of money to flush down the toilet.
It’s crazy to run through $600k+ in less than 3 years, that’s $200k/year!
The show paid off the mortgage, they remortgaged the new house, and they got $100k in cash to help them along?
Great job.
6 Sean // Jul 28, 2008 at 12:07 pm
The money might not even be the craziest part… did you see the slideshow with the original house? And the size of house that was next to it?
7 LivingAlmostLarge // Jul 28, 2008 at 1:12 pm
Probably an older home turned into a McMansion.
8 Brandy // Jul 29, 2008 at 11:25 pm
seems to me like theyre kinda jerky and ungrateful the way shes basically saying they may just walk away from this house and let the bank have it. thats poor ethics and character. oh her neighbors are mad, big whup, i dont like all my neighbors but who cares. theyre neighbors not you.
plus if they couldnt handle it they shouldnt have applied.
you can give me a huuuge new house and the only bill that will increase would be property taxes. its still the same # of people there and they can not leave all lights on and run water for days.
and they should be saving the money they werent spending on a mortage.
its not training but uncommon common sense here.
9 Livingalmostlarge // Jul 30, 2008 at 10:42 am
Most people who get a free home turn around and sell it because even without a mortgage the new property taxes are pretty expensive. BUT it usually gives them a lot of equity to buy a different home with it.
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