BAY ST. LOUIS, Miss. -- Marco Giardino is on the bubble. Hurricane Katrina left him with $1,525 monthly payments for a $400,000 home that is now little more than a shredded shell. "I'm thinking of walking away from it," he says.
The day before Hurricane Katrina hit, he was sitting on $300,000 in home equity. It was his nest egg; it was his future. "I was sitting pretty," recalls the 55-year-old NASA employee. "I lost all my wealth overnight.
Marco Giardino salvaging building materials from his destroyed home in hope to reuse it in the future, click ‘Play’ to hear about his concerns with rebuilding his home.
Now he's facing the prospect of paying a good portion of his income for what amounts to little more than a debris pile. Adding to pressure, Giardino's insurance company has offered him "not one red cent," on his main homeowner's policy he says, punching each word like it was a separate sentence. He also had additional coverage for wind damage, but his insurance company is saying it will only pay 50 percent on the policy, "which leaves me $60,000 short of the bank," he says.
Bankers say they have no idea how many homeowners will abandon their badly damaged or destroyed homes and properties in the Gulf Coast region, but they are bracing for the possibility of a tidal wave of foreclosures in the coming months. Those without insurance or who underinsured their properties are seen as far more likely to walk away from their investment and leave the banks to pick up the pieces.
Giardino and other homeowners throughout this battered region affected by Hurricane Katrina have had some breathing room, thanks to an agreement among lenders to suspend their payments for 90 days with no penalties. But that grace period is now ending and thousands of homeowners around the Gulf Coast are facing the same unappealing choices as Giardino: continue paying for an uninhabitable home -- or, in many cases, nothing more than concrete slabs -- or walk away and let the banks foreclose on their property.
Although "abandoning the place and letting it go into foreclosure is an option," Giardino says it's more likely that he will sell the lot for whatever he can get for it and borrow from relatives to pay off the remainder of his loan. Then he can examine his housing options in an area where he has strong ties and many reasons to stay.
Across the street from Giardino lives Nate Cranmer, 26, an unemployed welder who worked in New Orleans before the hurricane. Now he cuts trees when he can to make some money.
Cranmer's FEMA trailer sits in front of the house that he moved into four months before Katrina hit and which was literally pancaked by the storm. Unlike his neighbor, Cranmer's insurance has already paid him off, and he's sitting on $70,000 that he can use to rebuild.
Cranmer took advantage of the 90-day payment deferment, but says his mortgage company now wants him to pay those three missed months plus pay his regular $800 bill for December in one check. Despite the disaster zone that used to be his house, Cranmer says it's never entered his mind to walk away.
"But one of my neighbors walked away, totally," he says. "They left before the storm, they came back, checked it out but just don't have the money to rebuild so they're just leaving, the whole family."
Repayment rules vary
The 90-day grace period offered by lenders wasn't the result of a government mandate, and because of that lenders offered the three-month payment deferment on a wide range of terms. Some, like Cranmer's lender, whom he didn't identify, are asking homeowners to pay up all at once. Others are providing a range of options to their customers.
Giardino's lender, Countrywide, "was very generous" and offered him a variety of repayment options, he says. So far, he has chosen to simply tack the repayment onto the back end of his original loan.
Several homeowners MSNBC talked to said they were offered the deferment but elected to keep up with their payments anyway.
"Eventually we were going to have to make up those payments ... and we didn't want to put ourselves in that position," says E.J. Toomey, a NASA accountant whose home was being overrun by volunteers from the relief army of the "Eight Days of Hope" campaign, who were helping repair his roof.
The lack of standards for implementing the 90-day grace period adds to the problems facing homeowners, says Mike Shea, executive director for Acorn Housing Corp., a nonprofit that offers free housing counseling to low- and moderate-income homeowners.
"The result is confusion for already-stressed homeowners," Shea says. Now that the original 90-day period is over, you have some lenders that are offering an additional 90-day extension that will last through February. But in order to receive that extension, he says, some lenders are making homeowners sign papers agreeing to make a lump payment in March, a practice he labeled "predatory lending."
"You can't make people come up with a lump sum payment, that's our position and most responsible lenders understand that," he says.
Shea says most major lenders are trying to work with people, accepting partial payments and otherwise demonstrating flexibility in ways they haven't traditionally shown. "Then the question is, 'What do you do with the unpaid payments?'" Responsible lenders are saying they'll shift them to the "back end" of the loan or spread it over the life of the loan, he says.
In everyone's best interest
Washington Mutual, which services about 48,000 loans in the states hit by Katrina, gave each affected homeowner an automatic 90-day grace period when Katrina hit, says Nova Barnett, a company spokeswoman. Along with the 90-day suspension of payments, the company agreed not to issue any negative credit reports as a result of missed payments during that period, she says.
"Based on our analysis on December 1st, along with many other major lenders, we decided to automatically extend the initial 90-day forbearance for another 90 days," Barnett says.
The company hasn't yet worked out a plan for what will happen when it comes time for borrowers to resume repayment in March. "However, we won't make them pay it all at one time," she says. "We will work with each one on a case-by-case basis."
Banks have an interest in working with borrowers because they don't want to get into the foreclosure business, says Mac Deaver, president of the Mississippi Bankers Association.
"The biggest thing for our members is the overall economic impact on the community," he says. "They want to make sure the economy is going again and people are back in their homes and rebuilding. The livelihoods of our banks are tied to these communities. If the community isn't working, if the infrastructure isn't there and people can't make a living and make their payments then the banks can't survive either."
The federal government also has stepped into the act.
HUD helping 20,000
The Department of Housing and Urban Development has agreed to pay mortgage payments for an entire year for some 20,0000 Katrina victims holding federally insured loans. One hitch: The houses have to be repairable, HUD says.
Keesler Federal Credit Union says about 1,400 of its members in Katrina-hit areas took advantage of the 90-day grace period on their mortgages. Those suspended payments will be added to the back of the loan, says Nat Hebert, vice president of lending.
"If someone is still in a tough spot after having taken that initial 90-day suspension offer, we’re working with them on a case-by-case basis and it’s possible they can get another 90-day deferment," she says. "This is just the humane way of doing business. I can’t imagine making our members make up the payments in one lump sum."
Hebert says she has had a couple of people come in and tell her that they're afraid they'll have to walk away from their loans -- and their investment in their home. That decision depends on how swiftly other financial help comes to them, be that insurance or FEMA or the federal government, she says.
"It's kind of early ... to figure out what the end result will be, too early in the game to say what we'll do with foreclosures," she says. "There are too many variables; still too many unanswered questions to formulate a comprehensive action plan."
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While my heart goes out to all the people so horribly impacted by these hurricanes and other natural disaster, they serve as a continuing reminder of why I don't live near an ocean, or a lake, or a river, or on a highly active fault line, or in a valley, or in "tornado alley", or in the severe weather areas of the north and northeast, etc.
I am also reminded why I don't live in a $400,000 home I can't afford to pay for or insure, or have any credit card debt. My little town may not have the beautiful ocean, lakeside, or mountain vistas, but I don't have to worry if this coming hurricane, tornado, or winter season will be the one that levels my home.
I understand there are many who have almost no choice. They were born and raised in these areas and simply do not have much of a chance of ever leaving. It's got to be rough for them. But for those who willingly live in high-risk areas, I say "good luck with that". I don't begrudge your choice to live there, but if you do, you absolutely have to accept the risks of doing so, one of which is the potential to lose everything you have. You put your money on the table. Sometimes it comes up red and you win. Sometimes it comes up black and you lose. It's just the nature of the game.
Oh, and I wouldn't put much stock in the insurance companies or state/federal government doing much to get you out of trouble. They can't even seem to keep themselves out of trouble most of the time.
Ernie, O'Fallon, Illinois (Sent Dec 17, 2005 10:22:14 PM)
I feel so betrayed that our Gov. is currently spending some 90 billion
on nothing more than an experiment in a very oil rich nation of
people that want us to leave. But when it comes to our own not so
rich citizens our Prez. can't be bothered until his vacation is over.
Now I read some knucklehead in Idaho does'nt think we owe,or
should'nt help rebuild a AMERICAN city with a long and storied
history(not my tax money).Every elected official that voted for the
recently passed tranportation bill needs to reassess his or her
priorities(a 580 million bridge to nowhere etc.).Please America,
save our country and vote every Gov. Rep. that does'nt do the
morally correct thing to support our own citizens in time of need
out of office.Please start with the top and end in our local cities.
Guy Krisfalusi,Ca (Sent Dec 18, 2005 12:07:16 AM)
Wow! Reading all of these comments, especially Margie's make me reflect on how blessed my family is. A Katrina evacuee was staying at a friends home next door to me. Being in Real Estate, I noticed the Lousiana license plate on the car that was owned by her. I immediately walked over to see if there was anything we could do to help. She needed a place to call home for her and her pet. I immediately thought about my husbands organization, Homeward Bound, a non-profit organization, helping out near homeless families and domestic violance victims. I felt that she fit the bill. With very little convincing, they placed her and her pet in a home and I'm happy to say that she is doing very well. Why is it that strangers can help, but the people you trust the most to make everything ok, the people you pay on a monthly basis, insurance companies,mortgage companies, our goverment aid just can't see the real tragidy going on right in front of them. I applaud Countrywide Mtg. and the other companies that are understanding of this tragic event. I pray for all of the victims, and if WE need to pull together to make things better for them, then let do it. They can't wait for another disaster to happen. God bless you all and good luck.
Janet Oken Phoenix, AZ (Sent Dec 18, 2005 12:23:46 AM)
I keep seeing "if you live below sea level, expect to get wet". Most of New Orleans in not below sea level. The areas of Mississippi and Alabama affected are not below sea level. I lost a business in D'Iberville, it is not below sea level. I feel lucky, because I still have a house to live in and was able to move my Mississippi employees to my location in Mobile. These people bad mouthing the victims of Katrina don't have a clue about what life here is really like. In my work, I travel all over south Mississippi. It is not just the coast that is damaged, it is all of south Mississippi. There is wind damage well inland. In the past two hurricane seasons there have been four hurricanes close enough to damage our area in south Alabama. You want us to just walk away from our life here? The next time there are blizzards up north, or earthquakes and wild fires in the west, or flooding in New England, remember us down here on the gulf coast. We will be thinking of youwhen YOUR disaster hits.
Charles jacobs, Mobile, Alabama (Sent Dec 18, 2005 12:39:45 AM)
The only real solution to this issue is State and Federal Regulatory Intervention to help these people. The government should enact legislation mandating up to a 1 year extension of all loans. Interest accrued during that period would be added to the loan amount and the loan extended to allow the homeowner to pay it over the life of the loan. The federal government should also consider subsidizing the interest payments for those in dire financial straights as a part of all this massive hurricane related spending. It's time to send the funds directly to those who need it! The government should also enact an emergency National Flood Insurance Program, allowing those not insured for the flood damage to buy emergency coverage and get reimbursed for their losses up the existing limit of $250,000. There would be rules governing this, i.e., they musst use the funds to rebuild IN New Orleans, funds could not be used to just rebuild and sell or the insurance proceeds would be a lien on the property and have to be paid back. The purpose of this program would be to encourage rebuilding and community restoration. We would do that by essentially funding the reconstruction for the uninsured and either treating it as insurance proceeds or an additional low interest loan. The government needs to immediately determine what the guidelines will be for reconstruction. I would suggest that a two part program be put in place.
1. If New Orleans is to become a viable city again, there is no alternative but to build a huge flood control project in order to protect the city adequately from ANY hurricane which might hit the area in the future. New Orleans needs a "Dutch Style System", which will, once and for all, protect it from the ravages of the sea.
2. Building codes must be revised for all new construction in the city. All of "New" New Orleans should be built according to standards required for "coastal velocity zones" by the National Flood Program and other Coastal Communities. All structures should be elevated and/or placed on pilings. The homes should have breakaway walls underneath the allow for flood waters to pass under. Windows should have hurricane shutters and/or wind resistance glass. Hurricane clips should be used to secure the roofs and sidewalls. Florida style, steel reinforced masonry homes are another alternative. Another possiblity would be homes that "float", like the Dutch are building. These are regular homes, built on barges that sit on the ground. They are tied to pilings around the home. In the event of a major flood, the homes just float up onto the water and are held in place by the pilings. Little or no damage would occur with this type of contruction.
I'm another Long Islander, accustomed to seeing hurricances with some regularity. The threat of serious loss to property from Hurricane and Flood Damage is very real here. What I do not understand, and I would really appreciate an answer from someone is this. How did all the people in New Orleans get Mortgages without flood insurance. On Long Island, you simply cannot get a mortgage when your home is in a high risk flood zone unless you buy flood insurance. It is lender required. No lender here would expose themselves to large scale unininsured losses such as these. I simply do not understand how, in a city that is BELOW, sea level so many people could be allowed not to have flood insurance. Anyone with any even basic knowlege of insurance knows that Homeowners Policies do NOT cover Flood Damage. They never have covered flood damage, just like they don't cover Earthquakes. Nataura Catastrophes of this scale are simply too large an unpredicable to to be insurable. How do you transfer risk from one person to another in a city when the entire city is inundated. No carrier could charge a premium high enought to assume that kind of exposure. That's why we have the National Flood Insurance Program. It's high time the people in New Orlenas stopped blaming insurers for not giving away money to pay claims that there was no coverage for. It's time for people to step up, admit they didn't do what they should have done, that is, buy flood insurance, and structure a way for the entire area to be rebuilt, this time, with requirements that the proper insurance be in place.
I'm all for helping the people in New Orlens. I'm all for rebuilding the City better than it ever was. Let's just make sure we do it right this time.
Wayne Vitale, Center Moriches, NY (Sent Dec 18, 2005 1:03:50 AM)
Why is it that EVERY time someone acts irresponsibly or doesn't take prudent measures to protect themselves or their property or personal safety the government ( ie the rest of us ) has to pay for it? You choose to live in an area that is prone to hurricanes and CHOOSE not to have flood insurance. If the banks can't recover the investment then they go out of bussiness and the employees loose jobs. Many other people live in areas prone to natural disasters and choose to keep appropriate levels of insurance. Individuals like myself live in the midwest where we GET ONLY A FEW MINUTES warning for tornadoes. Hurricanes are known about for days if not a week. When you choose to live in an area subject to a certain set of risks the homeowner must be prepared. Do we need to put a sign up just like at the swimming pool MOVE IN AT YOUR OWN RISK. It is time for the rest of us who make good decisions to stop putting up with the persistant whining of all of the unfortunate people on the gulf coast. My parents lived in Slidell LA. My childhood home is gone BUT BUT BUT my parents chose to buy flood insurance for a whole whopping $300 per year ( yea the cost of that CELL PHONE THAT YOU DONT NEED ) and recouped all of the mortagage plus the contents of my original home. SO DONT WHINE IF YOU MAKE CRAPPY DECISIONS. The rest of us are not responsible for your failure.
ed boles, kansas city mo (Sent Dec 18, 2005 1:32:12 AM)
I truly feel sorry for those who have lost so much. Sorry for your lack of planning. Why should a company, whose goal it is to make money, have to pay for people living in an area that is prone to hurricanes each year? If somebody was to build a house on top of a volcano, I would assume they would know the risks associated with it.
Now let’s say you wanted to live in the area, and you paid for insurance, they should, and would pay you to rebuild. But if you haven’t paid them, why should they help?
Brandon G. Seattle, Wash (Sent Dec 18, 2005 1:49:19 AM)
In recent weeks I have been overwhelmed with the sad state of affairs in not only the United States, but our world. There is a prevalent lack of respect for our fellow men that is fueled by competition and greed for the almighty dollar. Seeing the devastation from this year's hurricane season, the war in Iraq, violence, intolerance of other's belief system and this country's obsession with power makes me want to move to a deserted island where I can live off of coconuts and fish, spending my days playing on the beach. One problem with that dream is that I would either have to convince my family to go with me or spend the rest of my life alone. The other problem is that lifestyle would inevitably result in a tsunami or hurricane blowing away my thatched hut. Or if that doesn't happen, someone would run me off and build a hotel on my little peace of the world.
Margaret Pruett, Clarksville, TN (Sent Dec 18, 2005 2:19:01 AM)
Some people are too frightened to face the fact that New Orleans is a major economy and is in the United States' national interest to rescue. Forget the sentiment. Prudent investment in restoring their infrastructure, schools, roads,etc. is good, necessary business. You can rebuild that faster than you could start from scratch. We have the money tied up in Washington pork. No one need worry additional money must be taken from their pocket. That investment will keep national GDP up at a time we can't afford to lose more businesses, business taxes, sales taxes, income taxes, or future workers. Don't flush a gold mine out of laziness or frustration.
Nichelle B Myrtle Beach, SC (Sent Dec 18, 2005 2:28:40 AM)
I tend to agree the Insurance industry needs to pay out, what is due to the policy holders. These are the same policy holders who may use or not use these companies agian. If the legal contracts of their policy does not get paid. then our insurance industry is a JOKE.
these CEOs seem to forget how they're companies got too big to care. Our trust in a good company that does good business. So now they can not make the profits they have grown accustom to. Take the loss and pay out properly. Gain back some respect from your customers.
J. Smith, Houston, TX (Sent Dec 18, 2005 3:07:45 AM)
if the government doesn't want to honor their obligations of helping those in need here at home then let them live in the destoryed homes or tents of those that have lost everything either that are use the big profits from the gas gauge prices that the oil companies made off of the general public to put these unfornuate vitims of a natual disater in homes for goodness sake, we as americans are always willing to help out other countries and even wipe off debts owed to the u.s.[look at how they wiped billions off to the governments of the world from wwii] why;in god's name can't they forgive these debts. i personally have had to do without because of the high gas prices,no meds,very few grocies etc. because it took the 300.00 a wk for my husband to go to work for the state of texas; he didn't get a cost of living raise out of that and we didn't expect one;however i feel that the vitims of this natural dister deserve more than the small sacafrice that we made by doing without. when will people wake up? call, write, and& or harrass the devil out of george and get him off of his thumbs!! if he can lie to us, spy on us, then he could at least give his salary since he is weathly already, to these people that are being left behind. he has preached no child left behind for over 16 yrs well what about families being left behind?
linda marie martinez (Sent Dec 18, 2005 6:40:35 AM)
Thank you Marge and all of you wo seem to understand the magnitude of the problems facing those on the Gulf Coasts of Al, MS and LA. For those of you who don't get, maybe you should review your geography and history books. A signofocant portion of the ravaged areas are not "below" sea level. Most of Bay St. Louis and Waveland avarege about 20 feet "above" sea level. Very little of these communities were affected when the category 5 Camille slammed into them in 1969. The 21 foot storm surge broke about 800 feet from the beach - it continued for miles during Katrina. I can't help but wonder what the average elevation of communities across the USA is. Every year there is flooding along rivers and streams, there are tornadoes, and earthquakes and scientists predisct the disappearance of Southern California in not so distant future.Should everyone living in vulnerable areas be required to move or refused insurance coverage? Should we huddle in areas that have never been affected by nature and live in cracker box condos like the Chinese? And I wonder what we would do for fuel if not for the hard working people of the Gulf Coast areas who work the oil wells and refineries that supply so much of the fuel in this country. Do we want to be totally reliant on the MIddles East? Should we abandon those operations or should we just expect those who work them to live in trailers or tents? I'm really having a hard time with those who just don't get it. 97,000 square miles of homes and towns were affected by Katrina alone. The impact of this storm was unprecedented. So past responses just don't relate. How could anyone have anticipated the enormity of this storm? We have to think outside of the box. The Port of New Orleans and the fishing industries of the Gulf Coast towns are critical elements of the nations commerce. New Olreans has been around for over 300 years. Why are the current residents and all those who lived in this great city for 300 years being dubbed foolish and undeserving of help because of one event? Why is the MS Gulf Coast suddenly an uninhabitable place? For anyone who has visited or lived there and has traveled to other countries and islands, I sincerely believe that most of them will tell you that the most beautiful beaches are along this coastline. This area puts FLorida to shame (no offense intended, I'm just prejudiced!). You will never meet people with such joix de Vivre (Joy of life) and willingness to work hard at whatever they do. Why can't we seem to get that across? Today, feezing rain is expected on the Coast and many families are still living in tents. Many of the FEMA trailers are poorly heated, the propane tanks that fuel the hot water heaters hold only 7 gallons. One has to carry the tank to a fillup point to restock - no trucks going around to service these tanks! Merry Christmas!
CW - transplant to Falls Church, VA (Sent Dec 18, 2005 9:14:42 AM)
I am one of the lucky, very lucky survivors who have come back to the city here with our jobs and our home. You have literally got to be here to see it and believe it. Worse, to FEEL it as so many above have stated. I drove out of here via the gulf coast, and when I think of how huge an area has been taken out - all the places I saw on that trip evacuating that no longer exist, I cannot believe it
STILL. Places that I drove through every summer - we are talking about 4 states here! It took Homestead Florida 12 years to get back to normal.... TWELVE LONG YEARS. And this is much, much bigger than Homestead. And then I came back here to the helicopters which were flying over the city that used to be a skyline at night. Not believable. Surreal. Some areas look like post nuclear bomb.
I did listen to the radio week before last on a Saturday - about 4:30 p.m. There was a Mr. Carr on this program- I think it may have been our Godsend station and only window into the world during those bleak, black days -- 870 a.m. People were hiring him right on the air --- getting his phone number. He knew his insurance and regularly deals with the paperwork trail and fights all the crap the insurance companies try to pull. People were calling in with their nightmares, and he was telling them what to do and how to do it. It may be worth it to hire someone to go to battle for you - if anyone recalls this program and can further enlighten people as to this guys' title and/or company, please jump in. Like law, unfortunately, it can become a war of the paperwork - but you stand a much better chance of winning if you have someone who knows the trenches. It is unfortunate, but if I were standing to lose $300,000.00 on my mortgage, I'd fight. Who would think you could pay your premium and then have to hire someone to enforce it - but many insurance companies will be bleeding with this storm.
Thank you all for your prayers. Please keep them coming. And thanks to all the heroes from the power companies, and phone companies, churches and all else who have graced us with their weeks of hard work away from home. --- Thanks South Dakota, wherever you are - for turning the lights on here in Mandeville!
Susantlb, Mandeville, Louisiana (Sent Dec 18, 2005 9:18:05 AM)
Caveat Emptor - when signing a mortgage or insurance policy, it is incumbent on the signer to become familiar with the terms. Believe it or not, sometimes mortgagers and insurers hope that you miss something!!!! As a previous blogger stated, we deserve the right to Life, Libery, and the pursuit of Happiness, not some all encompassing guarantee that nothing bad is ever going to happen. Take responsibility for your decisions. If the policy does not cover flood, and I lived in N.O., I'd be malfeasent for not reviewing that rather pertinent fact and either upgrading coverage or taking my chances. My house was almost totally destroyed by hurricane Charley; I also dealt with a recalcitrant insurer and an impatient mortgager; we didn't blame anyone or try to find someone to sue, rather we documented our issues and contacts and doggedly pursued our adjustor and claims rep until they settled the claim. We even gave Fema money back to Fema because it was covered by insurance (strange concept, that). My point is people need to take responsibility for their decisions and even for their ignorance. I'm not unsympathetic to the plight of those displaced (I was one), and we as Americans need to step up as only we can, and provide for our brethren, but when I hear of Red Cross and Fema debit cards buying Dooney and Bourke handbags and flat screen tv's in Buckhead, I am incensed. Don't blame Gov't or business for ones own ignorance, and stand up and take responsibility.
Anthony, Punta Gorda, Florida (Sent Dec 18, 2005 11:04:29 AM)
By some of the reasoning I've read here, the good people of Dakota's should have not rebuilt after they were flooded in 1997. The good people of Oklahoma, Arkansas, Texas, Kansas, Tennessee, Ohio, Illinois certainly shouldn't, being in tornado alley and all; especially if you have already been impacted once, you should know better by now. Oh and the good people of Dallas and Houston should never bother to rebuild since they are prone to flooding, have in the past and will in the future. The good folks of California, why you know you live in an area prone to mudslides and earthquakes so you better move don't even think about rebuilding. And the good folks of Florida, North Carolina, South Carolina, Mississippi, Alabama and Georgia...you know that you are in the possible path of hurricanes so why in the world would you want to live there? And finally those living in fire prone areas don't think about moving back and rebuilding. These are just some of the silly thoughts or comments I have heard over the years. I live in the south (Louisiana), born and raised in Oklahoma, have lived all over the US and overseas. There is not a state in this country that has not been impacted with some type of natural disaster at one time and probably will be again. Should those people not rebuild? In that scenario there would be no place in the US left to live.
I can not imagine not wanting to help these wonderful folks down here. I live about 30 minutes from Lake Charles, LA, let us not forget there are people there living in some of the same conditions as the folks from New Orleans, Mississippi and Alabama. And let us not forget that it wasn't just New Orleans impacted by Katrina and Rita, there are numerous towns along the Gulf Coast that were impacted and/or annililated by one or the other of the hurricanes. As we drove to Lake Charles yesterday all that could be seen for miles is blue roofs, for those fortunate enough to still have roofs. What I also saw that broke my heart is it is the holiday and there are people living in tents down here for any of numerous reasons. I like to say that a hand up is not a hand out. I spent a month helping the victims of Katrina that were living in our town. Then came Rita, we weren't allowed to come home for a week and when we were finally allowed to come home, I was sad, happy and scared all at the same time. We were lucky we came back to a 100 year old home with very little damage compared to others around us. But even with the damage we received, still we have not seen an insurance adjustor, others have seen them, but are having a horrible time getting the companies to pony up.
We are retired and have a small in home business, all of our income stopped from our business in October. Fortunately for us things are beginning to pick up again, but for 2 months we had no income but my husbands Social Security and still had bills to pay. Insurance takes the bulk of his SS so our income from our business is essential for basic living.
I can't even imagine what it is like for the folks that still have a mortgage to pay, nowhere to live and no way to make a living. I'm torn between wanting them to be able to rebuild thier lives in thier hometown and knowing that this can and will happen again. Perhaps as in North Dakota, the city took the the stand that the homes that were sitting on the Red River would not be allowed to rebuild. I know one area in Oklahoma when it was flooding so bad years ago we sat watching on our tv as houses were being washed away by the flood waters of the Canadian River. Did they learn anything, nope!! They are now building bigger houses in the same area, the city learned nothing, all they are interested in is the tax dollars. As each generation comes they don't look at history and tend to make some of the same mistakes made by the last generation. Let's not blame people for wanting to go home, they were born and raised there for generations. Somehow, someway there has to be a solution to this short of being angry that people want to go HOME. Wouldn't we all want the same thing?
Liz Rice, Jennings, LA (Sent Dec 18, 2005 11:05:29 AM)
Regarding Margie from Twin Cities post, It is the responsibility of our government to repair this situation. It is also the responsibliity of people to not buy/build a house in an area that is likely subject to natural calamity, unless you are ready to take the hit. What is wrong with this whole mess is that many built up areas are sitting on what used to be natural barriers, and other natural barrier areas have been modified by the "all knowing" human. This has been promoted variously by government, or greed, or necessity on the part of low income families who have little choice. Yes, we ARE responsible for this mess, but I think that even if we could get the government to rebuild everything, it is crazy, because it will happen again one day. A bigger correction than just fixing these people's homes is needed.
Maggie, Phoenix, Arizona (Sent Dec 18, 2005 11:07:04 AM)
When you sign a mortgage you should hire a lawyer,
they are supposed to discuss insurance and if you live in a flood zone, that is a very important topic.
In our area(a flood area) if you live in a flood zone you have to get flood insurance to even get a mortgage. Sounds to me that your mayor, govenor, state congress and senators should be put in jail for failing to protect the people they were supposedly serving; I would say 20 feet below sea level should be labled a mandatory flood zone requiring flood insurance to even get an mortgage application. I bet if you buy today there you will encounter this rule. A rule that should have already been in place. Also the state insurance commisioner should get 20 to life imprisionment. He is the one responsible for protecting the public from the insurance companies, clearly he or she did not.
On the other hand if you ignored the warnings from these reprensentatives {if they did do their jobs}
then you were gambling on the levee system working and chose not to get flood insurance to save money and it did not pay off. Again, thats why it should be mandatory.
jack, eastern ,NC (Sent Dec 18, 2005 11:08:09 AM)
I must say I am glad someone has finally had the courage to say that it is time we stop sending aid abroad. Why can't we stop and use the money for foreign aid right here in our own country. This country is supposed to be so wealthy and generous, well charity begins at home. Why can't we use the foreign aid right here and pay the past mortgage payments for the people of Katrina and Rita. It makes me laugh when Senators and Congressmen talk about how they understand what the hurricane survivors are going through. Their talk is cheap. They can pay there mortages and have money for food,clothes or what ever else they need for their families. They have no idea what it is like to be out of work and your home is gone and your family needs things. Washington, it is time to be quite and stop making speeches and put your money where your mouth is. Stop with the foreign aid. When the tsumani hit in the far east, there was the us with former presidents Bush and Clinton hitting the road asking americans for money. Well I ask you, where are the foreign allies with money for us? It is amazing how foreign nations critizine us and condem us yet they have no problem taking our monetary aid. I think it is time to stop. Americans are great in times of need. The company I work for match contributions it emplyees made to the red cross for the hurricane survivors. We also donated clothes, toys and anything else you can think of as well as money. Well to the the government in Washington D.C. rememember:CHARITY BEGINS AT HOME.
Carol Shakarian, Phoenix, Az formerly of New York City (Sent Dec 18, 2005 11:42:51 AM)
In my opinion, Insurance companies are nothing more than legal thieves. They can take your money and mislead you about your coverage and when something goes wrong, oops! you are not covered (though we let you think you were).
You would think that these companies would be required to keep X amount of dollars in say an escro account in the event of having to pay a claim, but no, they can put their money into the stock market and lose it!!!! Then make up the money by charging higher premiums, so their CEO's can still get multimillion paychecks and bonuses!!!
Corporate america has the power in this country not the people, yet the people are the ones that suffer through it all. The goverment needs to step up and help the AMERICAN PEOPLE rebuild, not pay to rebuild countries around the world while the AMERICAN PEOPLE lose everything!!!!!!!!!!!!!!!!!!!!!!!
J. Boone Virginia Beach, VA (Sent Dec 18, 2005 11:54:08 AM)
Insurance, by definition, is viable based upon the theory of "the law of large numbers". What this means is spreading the risk over a large group.
What the victims of Katrina should do is use this theory against the insurance companies and as a large group create higher riskand walk away from their properties.
If the group who walk away is large enough, it would be destroying the risk pool based on the law of large numbers for bot the insurance companies and the banks, who would then be likely to say hey wait a minute-maybe we should re-examine this situation.
If only a few walk away-the insurance companies and therefore the banks will win. If many walk away the banks will lose and therefore the insurance companies will lose. They of course will not stand for this and will either come to the table with a better solution for the victims or perhaps lobby the federal government for their losses as was the case a few years ago with Long term Capital Management.
Either way the victims will now have the attention and the protection they deserve and had paid for through interest payments and premiums.
Victims, band together now! Its the only way!
Joe Latour (Sent Dec 18, 2005 11:55:13 AM)
Logical Coastal Rebuild
Past and future hurricanes cause predictable immense damage and an equally immense opportunity. Much of the rebuilding will be performed with taxpayer dollars. Let’s make sure we can be proud of our investment.
Home and infrastructure rebuilding, when based on our taxes, must be done only in areas inherently safe from storm surges. Low lying areas of cities can be filled or abandoned; levies fight Mother Nature. Near coastal areas should be preserved as wetlands, parkland, or used for such privately insured industry and commerce, e.g., fisheries, shipping, oceanfront tourism, as must have immediate access to the water. The government does have a responsibility to help people in immediate need, but we should never fund return to the same precarious situation.
Let’s offer rebuilding companies an incentive to employ displaced and underemployed citizens, not illegal immigrants. And require all choosing to live in dangerous areas, coastal or flood plains, known earthquake zones, volcanic areas, to procure their own insurance. And while banks would initially cry "Too much paperwork!", require that they accept the payment of an insurance policy as the balance of any mortgage.
Tom Glasgow , Rocky River, OH (Sent Dec 18, 2005 12:03:52 PM)
It appears we need a court or arbitration system that can be rapidly responsive to citizens in need of protection. People who have responsibly purchased insurance and paid their premiums in a timely manner deserve equally timely and appropriate repayment. Let's see if any state legislature represents the people. The problems being faced in the coastal zone today could be in your state next time.
Tom Glasgow, Rocky River, OH (Sent Dec 18, 2005 12:15:41 PM)
Much of this situation comes down to personal responsibility. A devastating event has occurred that has displaced hundreds of thousands of people and left many of them with nothing.
Joe hurricane victim
The modest home that they had is destroyed, but they had little or no insurance because they could not afford it while raising there 3 kids even though both worked full time. They also had a car payment but could not afford insurance on either of their vehicles. They always had food on the table and Joe moonlighted some nights to keep the kids in nice clothes.
The problem here is that, like the vast majority of people across this nation, we live far beyond our means, make poor choices and have little sense of personal responsibility for those choices. If it is not affordable to insure your 1800 sq ft home with three kids and two cars, then guess what, one shouldn’t have purchased that second car or pushed for a house that was just a little bit bigger or even continued to have more children as times got tougher. Life is full of personal decisions that are made every day to affect life and contentment. In retrospect, affected persons may see the misguided, materialistic path that they took. I propose that that instead, everyone think about their current situation and become comfortable within their means.
Don’t read this and lash back at my ‘insensitivity’ or supposed ignorance. Tell me how different things would have been if every gulf coast citizen had afforded proper flood insurance, and had been saving 6-10% of their income in the bank for such a ‘rainy day’? Is this idealistic or is this something that only successful people do? Guess what, there are families of ALL incomes levels that are covered and doing fine today after this devastation because they were insured properly and lived within their means.
Quit living for today, invest in ones future and quit blaming someone else for oversight.
Charity is for those unfortunate persons caught off guard from unplanned bad situations. I applaud churches, the Red Cross, and other fundraising organizations!!! This is where recovery should tap. But know that the rest of this nation should not be TAXED for personal choices made by individual/ regional citizens. The government does not owe housing or happiness. No where in the constitution does it say that residents shall be afforded a trailer or a buffet line or designer clothes or free bags of ice.
TJ, Milwaukee, WI (Sent Dec 18, 2005 12:56:14 PM)
What amazes me is how everyone in the US of A has become a "victim!" As a child of the '60's I can't believe that people are putting up with this sh.. If I lived in Louisiana and my house was destroyed and had to deal with this, I'd hire a couple of dump trucks to cart off what was left and one would be dropping a load on 1600 Pennsylvania Avenue and the other would be dumping it on the driveway of the CEO of my insurance company! It's time to stop rolling over and playing dead!
Chris Born, USA (Sent Dec 18, 2005 1:02:45 PM)
Margie,
If my children had to go to school where there were no teaching materials. It would become a no brainer at that point and I would move.
Chris (Sent Dec 18, 2005 1:55:16 PM)
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