Judge rules against Burt Reynolds on foreclosure

Scripps Treasure Coast Newspapers reports Merrill Lynch Credit Corp., which is now Bank of America, filed the litigation in 2011 after Reynolds allegedly fell behind on mortgage payments on his waterfront Hobe Sound home known as Valhalla.

DYI Comments:  It never ceases to amaze me how actors despite their success end up being such morons when it comes to money.  Many end up passing away without a penny to their name.  If they had only followed Dave Ramsey's baby steps [or some other conservative approach] their end days would be dignified.

DYI 

It Wasn't Household Debt That Caused the Great Recession

It was how that debt was disproportionately distributed to America’s most economically fragile communities.

Princeton University professor Atif Mian and University of Chicago Booth School of Business professor Amir Sufi pin the blame squarely on policymakers, but not for any of these three reasons, all of which are variously popular with policymakers on different sides of the political divide in Washington. Instead, in their just-released book, House of Debt, they argue that the Great Recession was the result of a sharp fall-off in consumption due to the unevenly accumulated household debt in the first six years of the 21st century. In that period, mortgage-credit grew more than twice as fast in neighborhoods with low credit scores than in neighborhoods with high credit scores, a marked departure from the experience of previous decades. When the housing bubble popped, the economic consequences were sharply magnified by the way debt was distributed across households and communities.

Further, they point out that you cannot have a foreclosure crisis—or its associated sharp fall-off in demand—without debt and the way that debt grew during the early 2000s exacerbated the potential for a foreclosure crisis. Mian and Sufi find that about half of the rise in mortgage debt was among people who lived in their homes, not new purchasers. People took out home equity lines of credit and used the cash for home improvements, funds for their kids' college tuition, or other types of consumption. Once the crisis was in motion, about four-in-10 mortgage defaults were among home-equity borrowers. Thus, the foreclosure crisis was not due to people reaching to buy homes, but to borrowing against their primary asset. Had they not ramped up borrowing, falling home prices would not have affected consumption or led to record-high foreclosures.

DYI Comments: NONE