Ed McMahon was on Larry King last night talking about the recent news that his home is in foreclosure. I want to be snarky about it, eat the rich and all that, but I think it is just sad.
What rarely gets reported, and what probably goes to the fact that being rich don't make you smart, is that McMahon won more than the value of his home in a lawsuit against a company that was supposed to clean the mold from his house, but did not. McMahon could have paid his home off at that time but he chose not to. They say that the money went to gutting and rebuilding the interior of the home, but it doesn't look like that's what they did. From the little clippy they showed this morning, McMahon & Wife's excuse on being broke was that they spent beyond their means and showered too many gifts upon their friends. Well, when you go door to door doling out 10 million dollars, sooner or later it catches up with you.
McMahon is not alone. It seems that in Manhattan, some erstwhile Susie Socialites are quietly trying to scale back but are hoping that no one will notice. "I know the Escalade is two years old, but I just can't bear reprogramming the mp3 player". Look for victory gardens atop Fifth Ave penthouses all summer long. "The corn? It's ornamental!" I hear koi are delicious.
So New York’s very wealthy are addressing their distress in discreet and often awkward ways. They try to move their $165 sessions with personal trainers to a time slot that they know is already taken. They agree to tour multimillion-dollar apartments and then say the spaces don’t match their specifications. They apply for a line of credit before art auctions, supposedly to buy a painting or a sculpture, but use that borrowed money to pay other debtsWhat was that thing about the subprime mess being the fault of ignorant, low class borrowers who had no business messing with finance? Ha Ha! I found my snark.
You know what Ed McMahon and I have in common? Ascot? no. Faded trophy wife? no. Halitosis? Let me check-(huhh, huhh in my palm) yeah, probably particularly if he likes as much coffee as me. No the other thing is that Countrywide Mortgage foreclosed on me, too.
A few years ago in the midst of the re-fi, go-go market, Ben and I bought a duplex. Right after we bought it, a new lender bought the mortgage from the lender we had at closing. That lender was Countrywide. For some reason, Countrywide sent all correspondence to the rental unit (though our home address was prominent in the closing papers) where the tenant promptly threw it all away. At our house we would casually notice that we weren't receiving our mortgage bills but assume that the shell game was continuing and that sooner or later we'd get our statement.
When we finally got our statement it was in the form of a sheriff knocking on the door and handing me a summons.
In the next few weeks our conversations with Countrywide were truly bizarre. Let me say that the first thing we did upon discovering which company owned our property for us was to pay up our balance. However, Countrywide didn't want to dismiss the foreclosure until we paid their legal and search fees, which they claimed came to over three thousand dollars.
"Send me your itemized bill. Show me the hours you've been charged for," I said.
"Well," they hesitated. "A lot of that is internal. We had to do a search to find you so that we could serve you with papers."
"How did you do that?" I asked. "Did you hire a detective?"
"No. We did an on-line search".
They googled me for three grand?
"Did you check your own database?" I asked.
"Then you probably should have found us, since you hold another of our mortgages."
So Countrywide dropped the foreclosure, and we promptly financed through another lender. I could never say for sure but my suspicions are that Countrywide had a little scam going where they quickly moved for foreclosure so that they can collect fees they don't incur. I think that by the time we were served we had missed two of their statements. Unfortunately, the foreclosure is on our credit reports - as resolved, but still. The other crappy thing is that all those people who bought those real estate get-rich guides call you on the phone because they've seen in court records that there is a foreclosure against you. They want to buy your property for pennies on the dollar. Even though we weren't actually losing a home, it felt humiliating to get condescending calls from rank amateurs.
I feel for people, even Ed McMahon, who go through it for real.