Sellers Get Creative: A Subprime Florida Mortgage Story Gone Bad

Last week, Amanda Stark and her husband, Bill Berry, thought they’d hit upon a creative idea to save their home: They’d raffle off their RV.

They’d sell tickets for $20, then throw a party to draw the winning name. And if all went as planned, they’d collect enough money to pay about $3, 500 in past-due property taxes.

That idea fell through when the Fort Myers couple decided that the RV, a 1983 Fleetwood Tioga, is in too poor a condition to give away as a prize. But the party, scheduled for this past weekend, had already been planned by then.

Stark, 30, and Berry, 34, hope that the mingling will at least raise awareness of a Florida housing market problem: Crazy ideas, like RV raffles, don’t sound so crazy any more, now that many mid-wage workers can’t afford homes here. Blame skyrocketing prices, property insurance rates and property taxes. Five years ago, the median price of an existing home in the state was $133, 700.

Now it’s $237, 800.

Stark said they might set out a bucket today to collect donations for their property tax bill. “But I don’t think we’re really going to push the issue too hard, ” she said. “I don’t want to put anyone in a position to feel like they’re obligated.”

Stark and Berry - parents of 2-year-old Patrick - bought their three-bedroom house a year ago for $229, 000, with a bad credit Florida mortgage and no down payment.

The interest rates were steep: 8.75 percent on 80 percent of the mortgage, and 11.25 percent on the other 20 percent. “Every time I say it, ” Stark said, “it just kills me.”

“We thought, ‘For two years, we’ll struggle and get by, and after two years, we’ll [Florida mortgage refinance], ‘ ” said Stark, a restaurant manager.

But Berry, a carpenter, has had a hard time finding work since the housing market slowed. They’d been paying $1, 000 a month in rent; now, they’ve got an $1, 800-per-month mortgage, and another $600 in property taxes and insurance.

“This could be a farewell party, too, ” Stark said.

SOURCE: The St. Petersburg Times