- Title: Americans trapped in underwater mortgages
- Date: 14th September 2018
- Summary: EAST STROUDSDBURG, PENNSYLVANIA, UNITED STATES (SEPTEMBER 12, 2018) (REUTERS) PAN FROM NEW YORK HOMEOWNER, MICHAEL PAYNE, TO HIS HOME FRONT OF PAYNE'S HOUSE WITH FIRE HYDRANT IN THE FOREGROUND PAN ACROSS FRONT OF HOUSE (SOUNDBITE) (English) NEW YORK HOMEOWNER, MICHAEL PAYNE, SAYING: "It makes me feel like I got the short end of the stick. I finally got a piece of the pie but at the same time I feel like I got slighted, you know, with this situation." VARIOUS OF SIGNAGE FOR PENN ESTATES PROPERTY OWNERS ASSOCIATION IN POCONO MOUNTAINS CARS LEAVING AND ENTERING PENN ESTATES PENN ESTATES COMMUNITY CENTER SIGN PAN FROM COMMUNITY PLAYGROUND TO POOL (SOUNDBITE) (English) NEW YORK HOMEOWNER, MICHAEL PAYNE, SAYING: "At this particular time, from the time we moved here to the time we're ready to leave, we should've had some type of equity on a plus level, so we could move on comfortably." PAYNE CHECKING HIS PLANTS (SOUNDBITE) (English) NEW YORK HOMEOWNER, MICHAEL PAYNE, SAYING: "It spoils the plan that we can't go right away, we have to find another alternative." HOUSES IN THE NEIGHBORHOOD SEEN FROM CAR DRIVING DOWN STREET PAYNE'S HOUSE AND DRIVEWAY
- Embargoed: 28th September 2018 16:58
- Keywords: single-family home Pocono Mountains financial crisis mortgage value of their home homes underwater foreclosure Michael Payne
- Location: EAST STROUDSBURG, PENNSYLVANIA, UNITED STATES
- City: EAST STROUDSBURG, PENNSYLVANIA, UNITED STATES
- Country: USA
- Topics: Debt Markets,Economic Events
- Reuters ID: LVA0018XLOEJ1
- Aspect Ratio: 16:9
- Story Text: The powder-blue single-family home located in a gated community in the Pennsylvania Pocono Mountains - 80 miles northwest of New York City - was supposed to be Michael Payne's slice of heaven on earth.
But a decade after the financial crisis, Payne cannot believe his house is worth less than half of what he paid for it, sticking his family with a mortgage that's bigger than the value of their home.
Payne said, "It makes me feel like I got the short end of the stick. I finally got a piece of the pie but at the same time I feel like I got slighted. We feel trapped."
Monroe County, where Payne lives, is still one of the hardest hit real estate markets in the country, 10 years after the financial crisis. Nearly 25 percent of all the homes there are underwater, which means the mortgage is worth more than the value of the home. Nationwide, that rate is closer to 10 percent.
Buying a house 12 years ago for under $184,000 with amenities like a community swimming pool, club house and tennis courts made financial sense to Payne and his wife.
The plan: build equity and then sell the house to fund their dream of retiring in Florida.
A dream that should be closer to reality now that his wife is retiring as a teacher at the end of the school year. But instead, they're staying put.
He is keeping his job at an Amazon fulfillment center to keep paying the mortgage.
"From the time we moved here to the time we're ready to leave, we should've had some type of equity on a plus level, so we could move on comfortably," he said. "It just spoils us. It spoils the plan that we can't go right away, we have to find another alternative."
Home prices in the Poconos were inflated during the run-up to the crisis as rent-weary New Yorkers flocked to the area. And as Payne admits, what looked like a cheaper mortgage at first turned out to be just as costly as city rent, once taxes and other expenses were added.
Many of his neighbors have been forced into foreclosure, but Payne told Reuters he was not ready to walk away.
"It's still my piece of heaven. This is my paradise for now," he said.
"I'm the forgotten one when it comes to the money coming in - what happen to that trickling down effect?" - Copyright Holder: REUTERS
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