14 Million Abandoned Homes and BofA’s Moynihan on Housing

Think the market is getting better? It’s a total fabrication. And wait, what about the rest of the 12 Million that are underwater…or the possible 10 million MORE mortgages set to default.

According to a recent study, 9.9 million homes have been vacant since 2008 due to foreclosure. and as of 2011 that number has increased to 14.3 million units. Many blame the bleak housing market and the unemployment rate for the number of abandon homes in America. So how can the US solve this problem? John Taylor, CEO for the National Community Reinvestment Coalition, and Anthony Randazzo, director of economic research for the Reason Foundation, give us their take on what should be done with the homes.

See the video below with John Taylor and Anthony Randazzo. Interestingly Randazzo seems to be taking the “Market will fix itself” approach. Meanwhile we’re talking about 14 million abandoned homes and 10 million more on the way.

Bank of America's Moynihan on U.S. Housing, Deficit

Bank of America Corp. Chief Executive Officer Brian Moynihan talks about the U.S. housing market, economy and budget deficit.

According to Moynihan, the worst is over and BofA has been all about helping homeowners and modifying loans. How about that?

So, modifications are what BofA is all about and helping families. Except of course when you try to claim the death of a child as a hardship, like the denial letter sent to a California family:

Notwithstanding that they were broke, the Lesleys didn’t ask for a forbearance of any amount of the loan. Instead, they asked to participate in a loan modification program designed to let people with hardships remain in their homes. They owed $350,000 on a home that was now worth probably half that. Not an uncommon occurrence in Southern California. If the hardship modification was granted, the Lesleys could stay in their home, get back on their feet and the investor who owned the note would be made whole. Makes sense, right?

The obvious answer was apparently not so obvious to Litton and Bank of America.

The Lesleys say Litton (on behalf of Bank of America) wrote to them denying their modification and told them that the tragic death of their son and the enormous medical bills they incurred trying to save his life was not a ‘true hardship.’

The alternative to modification was foreclosure. Proceeding with foreclosure would leave the Lesleys homeless and leave the bank with a fraction of what was owed on the mortgage as the house worth far less than the mortgage. In the words of Noel and Debra, There was and is no justification, either in law, in common business sense, or basic humanity for the decision Litton and Bank of America took other than to cause as much emotional pain to Plaintiffs as possible.

You can read the full article here.