Monday, July 28, 2008

Extreme makeover: Foreclosure edition

Not much I can really add to the story that a house built in 2005 for a down-on-their-luck family on the TV show Extreme Makeover: Home Edition has gone into foreclosure.

The four-storey mini-mansion, built for the Harper family with the help of 1,800 volunteers and residents from Lake City, Georgia, will be auctioned off to the highest bidder on August 5th. The house was used as collateral for a $450,000 loan that went into default.

Sad, really. Obviously in retrospect, it's not always the greatest idea to shower people in dire financial straights with windfalls like this because they don't always know how to handle it, but this whole story also says some particularly sad things about the worsening state of the U.S. economy in general.

5 comments:

Richard said...

The story does mention the loan was used to start a construction business, which doesn't sound as bad... although there's no way to tell if they were really interested in that or just trying to take advantage of the housing situation in general. Add taking out a mortgage to start a construction business under investing your retirement savings in your employer on the list of ways to under-diversify!

kingdave said...

EM:HE teaches everyone that "happiness" = "oversized monster house with absurd and unnecessary amenities that wastes way more resources than it should".

They are not doing these families a favor and anyone who is "touched" by the supposed "generosity" of the show has blinders on. They do it for ratings and once the shows are over they don't give a darn what happens. I have always thought that they should use the funds and volunteers that they devote to giving one family an absurd setup and, instead, help 10 families out by giving them something more reasonable.

peasantDave said...

kingdave,

I think that you are missing the point. The point is that giving people handouts does them more harm than good. Giving money to people that do not know how to manage it is the worst thing that you can do for them! This story just takes it up a notch, because they gave them a house and the money to maintain it for their lifetimes and it only took them 3 years to squander it and lose the house.

The resources would have been better spent by giving Mr Harper a job and teaching him how to fix up his own house. Then he would have some of the experience needed to start a construction business when the market turned back around.

Richard said...

Let's not forget that the loan wasn't just for bigger vehicles and more shopping. It's hard to tell if they made a serious effort - it certainly reminds me of "fair weather real estate agents" - but it's not the worst thing to do really.

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