Your Voice: ‘Voices of Tracy’ speaks to broader audience
by Brooke Battles, Oakland
Jun 20, 2013 | 2120 views | 19 19 comments | 170 170 recommendations | email to a friend | print
EDITOR,

Anné Klint’s thoughtful look at foreclosures in Tracy and the people they affected touched my heart with its insight and gentleness.

Its centerpiece, the hour-long film “Home,” is made up of interviews primarily with those who lost their homes, but in some cases those who re-inhabited those homes. The hauntingly simple music and the beautiful photography coupled tell the story of loss, broken banking systems, personal strength and new beginnings.

The show in the galleries — Klint’s photographs and additional footage shown in a “living room” made of moving boxes and books on real estate investing — captures more of the irony of the devastation that banks created, encouraged and failed to ever address.

My hope in writing to you is that this show will travel to other places and be seen by many more people, because this show is not the story of Tracy — it is the story of people in all parts of this country who were simply following the market toward the American Dream. And, unfortunately, it is the story of a system that ripped those dreams apart and took all the profits.

My thanks to Anné Klint for creating such an intense and moving show for the Grand Theatre Center for the Arts, and to the Grand for giving us all a place to experience it.

Comments
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inhabityourcity
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June 27, 2013
It is easy to talk about personal responsibility here, but when a stranger tells you that her bank forced her out of her house 2 weeks after giving birth, do you say to her, "Well, I'm sure it was your own fault. Own it!"?

I wish the personal responsibility argument went both ways. Corporations want the rights of individuals, yet don't have to take personal responsibility and face bankruptcy like the rest of us real-life individuals.

backinblack, I hope you will come to see the film at the Grand Theatre on Saturday, July 13th - 11 am, will be the screening time. We will follow it with a discussion about the entire project at noon. The exhibition is open in the Grand Galleries Tues-Fri 10-6 and Saturdays 10-2 through July 20th.
inhabityourcity
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June 27, 2013
First, I am an artist, not a financial counselor. This project was never intended to capture more statistics, but rather to put real people, faces, and voices to those statistics. It would have been extremely inappropriate for me to ask my project collaborators personal financial questions regarding their credit scores, etc. My husband and I are well-educated and consider ourselves informed consumers. We sought advice from numerous outlets. We asked our loan officers for explanations, we did what we thought was appropriate given the overall climate. We made mistakes, as did many, many other well-informed, educated people. We own those mistakes and take responsibility for them.

It is extremely easy for all of us over here to talk about "personal responsibility," which is the classic blame the victim response. Of course, there should have been more personal responsibility all around. That includes the loan officers who pushed irresponsible products on consumers whom they knew would end up in trouble down the road. That includes Wall Street, who knew this products were risky, yet passed them off as safe investments. To claim this didn't happen is a disservice to millions.
victor_jm
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June 27, 2013
I don't trust anyone who proclaims to be an artist.
backinblack
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June 25, 2013
To Anne's question, "how do we move forward from here?"

The first thing we need to do is accept the reality of what got us here. There's too many people in this country who think someone owes them something, or they have some sort of right to own something whether they can actually afford it ot not, that to me is problem one.

Anne, maybe I should watch your film to get my own answers but if you don't mind I have a some questions. Of the people you interviewed do you know:

Their credit scores and debt to income ratios when they bought their home.

If they were W2 wage earners who took out stated income loans.

If they refinanced, how many knew about the 72hr recission period.

How many have a sufficent knowledge of interest only and ARM loan products.

Admit to not knowing much about what they signed yet did not ask someone with more knowledge for help.

See where I'm going? Again I ask, where does the personal responsiblity part come in?

This brings me to problem #2. For our little experiment which started in 1776 to work, as Jefferson believed, we need a well educated and well informed populace. Let's go back to something I have talked about for at leat 20 years, we should have requirements for kids to pass a course in how credit & loans work. I believe a well put together program and the right teachers could limit the course to 2 weeks. That would be a start. Imagine if first time buyers knew about acceptable levels of debt to income ratio's and how they are calculated. Imagine if the knew stated income loans were originally intended for business owners and people with hard to prove income, but not a W2 earner. Hey Mr. Loan officer, my W2 shows this, why are you putting a higher number on the loan app?

Problem #3. Too many in our government do not want a well educated and well informed populace, not quite sure how we fix that one as it seems the ill-informed and under educated are already becoming a majority.

Bottom line for me, fix the core problems then the peripherals become less of a threat as at the end of the day it comes down to the person who layed pen to paper and signed the loan docs.
backinblack
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June 25, 2013
"I give all you ppl here the answer and you act as if you were offended."

Offended? No, just a bit perplexed about how you seem to be the only person on earth who blames the collapse of the housing market solely on tax codes & bankruptcy law.

I admit I exaggerated a bit bt saying 121 had nothing to do with it. However, although mentioned by some in at most a passing manner, the reasons you cite had minimal impact on the collapse. Let's apply a little common sense derived from a little deeper look at what you assert.

Of all the experts, opinions, and causes sited - which are way more than what you put forth, the one pretty much everyone agrees on is the collapse of the subprime market. With that in mind let's look at what you are trying to put forth.

How many people had the money or credit to buy multiple properties and do flips?

How many people put out the effort to live in a house for a year, move out for 3, then move back in for 1, and then sell with a $250 - $500k profit?

How many of those people were subprime borrowers? Hmmm.

cont...............

backinblack
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June 25, 2013
When you add it all up especially the last one which is probably zero, common sense and the facts say a low number of mortgage defaults are attributable to tax codes & bankruptcy law. Therefor the things you site are relatively small players when looked at with the other factors involved.

In addition to the collapse of the subprime market the other cause many people agree on is laxed lending standards. At this point let me add a fact to this part of the discussion. The standard(prime market)did not go south until the subprime collapse took it's toll on the overall health of the economy. Businesses slowed, started layoffs, closing, spending slowed, etc. That's when above average defaults started hitting the standard mortgage market.

This get's to my main point. Inspite of tax codes, bankruptcy law, Wall St machinations, evil loan officers, real estate agents, et al, it all comes down to people taking out loans they should have known they could not afford. Not to be redundant but it appears to be necessary, disaster was set in motion when people with 580 credit scores, W2's, and minimal downs were allowed to qualify on stated income.

Going to Vic's comment, "I suppose if a buyer (we, the people) is financially unqualified to purchase a product, then a seller (we, the people) ought to deny him this opportunity"

Exactly, it's called a decline and when they stopped happening with people who warranted such a decision, boom! Turn out the lights.

cont.....

cody01
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June 25, 2013
If you want the answer for when to sell, It'll cost ya'.

I sold my properties in 2004. Made my profits, walked.

Told other to do the same, Out of 863 I told, only 3 followed. Guess the rest had "Trust Issues".

Had a client come in, did 5 years of back taxes on the guy. Got him over $10,000.00. He thought he was going to owe The IRS. He already modified his home, himself. Got a really bad deal. Still couldn't afford the monthly payment. Not as bad as before but, still too much.

I said, well, lets do it again, go for a principle reduction.

He said, Wells Fargo told me I couldn't. Only get to modify once.

I could just look at the guy. It is so frustrating sometimes. Why do I even try and help ppl. I give all you ppl here the answer and you act as if you were offended.

Wells Fargo called the guy yesterday. They are waiting for the documents. They are ready to modify, AGAIN! 2 days ago, The guy gives me $500.00 as a down payment for a modification. That is not what I said. I told him my fee then. He was a non believer. Till he got that call from Wells Fargo.
cody01
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June 25, 2013
In 1997,May 6th under the Clinton administration Sec. 121 went into effect. Live in a home for 2 years, within a 5 year period, live there the first year and the last year. could rent it out for 3 years in between, But you could just do it for 2 years, then, Sell it and have a $250,000.00 exclusion if single, $500,000.00 EXCLUSION if married. Basically pay no taxes on the sale of your home. Crazy, Hu?

Reason the housing market went stupid. The IRS even did away with the form 2119 sale of a home.

People didn't begin to apply it until 2001. Afraid of it. Too good to be true. Once they realized it was no joke, ppl took advantage of it.

As ppl do.

There is a question on the 593. That's the form used when there is a taxable sale of a home. It's for withholding. It ask'; Does your home meet the "Sec 121" exclusion? That regulation I just quoted. Just like most ppl, Even here, Nobody knew what "Sec 121" is, Yet, That box got marked "YES". Somehow, It got marked "YES". ppl didn't even live in the house in some cases. None of them knew what "Sec 121" is, go figure. Somebody had to get that box marked "YES". Title companies and real estate agents/brokers.
cody01
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June 25, 2013
If the seller knew it was a taxable sale, they would not sale. Nobody would get their commissions.

Regular, God fearing, Law abiding, honest folks got pulled into a very dishonest act. Many walked away with $500,000.00 cash. Then took it all and dropped it on another house. All their eggs in one basket.

The market went down, they lost it all.

10/17/2005, The Bankruptcy court(Congress) passed The BACPA.

They regulated the housing market and changed the way we do credit. Title companies have to E-File those closing papers on the sale of a home to The IRS. They know when it is sold SHORT, and that's what the SHORT sale really is, Not what they call it in Modification land. Our economy went south on that date for that reason. Made it harder to file a Chapter "7" bankruptcy, Too.

victor_jm
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June 24, 2013
"Where does personal responsibility and common sense come into play on the part of the buyer?"

BackInBlack is fond of saying "we, the people," as if we, the people, don't reside in every facet of society.

I suppose if a buyer (we, the people) is financially unqualified to purchase a product, then a seller (we, the people) ought to deny him this opportunity, but we know why the seller is often willing to grant a potential buyer this risk.

backinblack
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June 24, 2013
Cody, Can you please explain in detail how exactly Section 121 of the tax code helped cause the housing collapse? Of all the experts & opinions on the various causes I have not seen one touch on 121. Why, 121 had nothing to do with it.

First off 121 has nothing to do with investment properties as it applies to a principal residence therefor rentals don't fall under the code.

Secondly and of most importance, how many people do you think actually think of tax consequences for selling at the time they sign purchase docs? Let me help, probably very few. Sure, when someone goes to sell they should contact their accountant to check on the possible tax ramifications but at time of purchase? C'mon.

If someone is buying a primary residence with the intent of only staying a short time such as less than 5 years then maybe in that case they will look at the future tax exposure but again, we are talking a limited number of people doing so.

I've owned a number of homes and have used interest only loans to good advantage, I also know a number of people tho have done the same, throw in taking advantage of ARM's. These are not the evil things way too many people make them out to be.

cont....
backinblack
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June 24, 2013
As already stated a house is an investment even if you plan on living in it for the rest of your life and one more time, with investments sometimes you lose and sometimes you win. ARM's & interest only loans are a tool when used in the right situation, and with the right timing can be advantageous. If people aren't educated well enough on the ins & outs of those loan products, if a real estate agent or loan officer doesn't explain them properly, or if they are taken out at the wrong time during a market cycle then yes, they can bite you in the backside.

The other problem is with overly optimistic people who go into an ARM thinking interest rates are never going up. I once took an ARM out at the right time and had the payment on my second drop $500, refied again at the right time to lock in the lower rate, bingo. In hindsight I could have waited a little longer and would have got a little lower rate but of course that would be a gamble as it could go the other way again.

"I could show folks when they would lose their home"

Well almighty oracle of Tracy, can you please let the rest of us know exactly when the real estate market will hit another peak so we can all sell at the right time?

Thanks.

inhabityourcity
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June 24, 2013
cody01 and backinblack, thank you both for your comments, but I'd like to ask you both where can we go from here? How do we move the discussion from the nuts and bolts of tax law, statistics and market wins and losses to what is at the heart of the Voices of Tracy project? A supercharged real estate atmosphere coupled with Wall Street wheelings and dealings exacerbated by our own misunderstanding/misinformation led us to where we are now. According to the Modesto Bee, more than 35,500 homes in San Joaquin County have been lost to foreclosure since 2006. These losses have humans attached to them. Men, women, and children whose lives have been altered, some of them devastated. This project is about those real people, their real emotions. The question is, how do we move forward from here?
cody01
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June 24, 2013
Myths and the someone effect;

1. Home loans can be modified more than once.

2. Modifications are "NOT" for attorney's, Accountants get the numbers right.

3. Modifications are "NOT" going to last 4ever. Suppose to end last year(2006-2012). They were extended. 6 months remaining.

4. Most of the places that do Home Loan Modifications are scammers.Never go with anyone out of your area. You have to be able to show up at their front door. Many that were set up in Real Estate offices took the money and just left.

5. Cost. Most losing their homes are broke. Charging $5,000.00 is ridiculous. Saw a guy pay $2,500.00 and in 2 weeks, was asked for another $2,500.00. Got -0-. Lost home. $1,500.00 up front, $1,000.00 once completed is fair.

6. Someone tells you to do your own, Work with HUD. 1st phone number the banks give you to call for assistance.NOT! You will be talking to a person that has a direct line to the bank that gave you the phone number. This is the reason for 80% of the failures to qualify. They get the numbers wrong every time and the bank gets the wrong numbers instantly. Don't do it!

7. Those that do their own, never get the principle reduction. Maybe a couple but, they got lucky and, Still got themselves into an ugly loan that will cause them to lose it within 10 years. After there is no way to fix it. That "Someone" that advised will suffer none of the consequences.

8. The common amount for a principle reduction? Depends. There are so many options. It is not just filling out the RMA. Presentation is everything. Have to give the banks options,Too. Like with the HUD, Self prepared locks you into a formula that places you into a category. They take your numbers to a chart and that's where you fit in. Bad.

9. Even after all these mistakes, ppl will still feel that got a great deal.

10. The "Principle Reduction" is the way to go. you can even Re-Fi the current value and leave the remainder hanging out there. No! get it to a value that may show some equity some day.Hope.

11. Short sales to save your credit. Not even. They do not save your credit. Those are a way for banks to get more "Stimulus" money. You lose your home and someone gets to buy it "Cheap" and, They won't sell it to you for that cheap. Why? BECAUSE YOU HAVE NO CREDIT!
backinblack
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June 24, 2013
Did you go through a loan modification or read this stuff somewhere on the net?

In regards to #11, do you have a background in financing and are you aware of the various factors which go into computing a credit score?
cody01
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June 24, 2013
I saw the closing papers on these loans. The Re-Fi deals were ridiculous. The "Interest Only's", I could show folks when they would lose their home. In 5 to 10 years. Figured they would Re-Fi out of those, Yet, There were no Re-Fi's available. Foreclosure.

Then came the foreclosure hustlers. Even they lost their @$$. Many investors jumped in to make some profits, Only to have the homes lose another $100,000.00 in months. That hurts when you pick up say 10 of those.

It was the lack of regulation. Sec. 121 of IRS code.
backinblack
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June 23, 2013
Not to come of as not being sympathetic to those who lost their homes but a couple of Brookes comments seem to follow a trend of not acknowledging facts and not placing enough blame on we the people.

"And, unfortunately, it is the story of a system that ripped those dreams apart and took all the profits."

"captures more of the irony of the devastation that banks created, encouraged and failed to ever address."

Someone correct me if I'm wrong but I don't know of a single verifiable account of someone signing loan docs while a realtor or loan office held a gun to their head. Blame the banks all you want but as buyers we all have the ability to walk away. Buying a home or refinancing is not done on an impulse, the process takes awhile so there's plenty of time to research, ask questions, go over a budget, and most importantly think carefully about what you are about to do.

Although there are many factors involved as to what caused the housing collapse and subsequent recession the one most easily avoided by we the people is laxed lending practices revolving mainly around the abuse of stated income (liar) loans.

cont....

backinblack
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June 23, 2013
When W2 wage earners with at best mediocre credit and already out of balance debt to income ratios started getting approvals - and throw in minimum down payments, the recipe for disaster was set. I have a hard time blaming realtors, banks, and loan officers when a person with a 580 credit score who struggles to make $50 per month credit card payments signs a loan for a $1500 per month mortgage payment. Where does personal responsibility and common sense come into play on the part of the buyer?

I'll bet my last dollar at the time people turned the key for the first time the realtor & lender were their hero's. Is it truly the banks fault if one knowingly takes on debt they can't really afford and end up losing thier home? To me the answer beyond question is no.

Of course people with good credit and solid debt to income ratios also lose homes, a home is like any other investment, sometimes they don't work out. Unfortunately this time around a lot of the people who could actually afford their home lost it when the economy tanked after the sub-prime market headed south and the dominoes started to fall dragging damn near everybody down.

As for interest only and ARM's, they can be good loan products in the hands of those who understand how to use them properly in certain situations. Granted, especially in the case of ARM's they can come back to bite you despite good planning but again, who's fault is it when that happens? We the people.

As with a good majority of people I've made my fair share of poor financial decisions sometimes going against my knowledge and common sense, including poor timing of an ARM. However, unlike many others I do not blame anyone other than the guy I see in the mirror.

Things sometimes happen in our lives which are beyond our control but for the most part we control our own destiny. When looking back in an honest fashion most if not all of our problems including losing a home are our fault.

Too many people these days seem to lack comprehension of the right to the pursuit of happiness as they apparently interpret pursuit as guarantee.

Want the true problem of the housing market collapse mitigated along with default rates on car loans & other types of credit? Make it a requirement for every high school graduate to pass a course in how credit works. Make sure they understand what comprises a credit score, sustainable debt to income ratios, the difference between simple & compound interest, key points to look for on loan docs. etc.

There's certain things we learn in school which once in the real world we may not use extensively but credit & loans are things all of us will eventually use and in most cases on an extensive basis. Why don't we start giving kids the proper tools to deal with it?

inhabityourcity
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June 21, 2013
Thank you, Brooke, for your kind and generous words. It is often not easy to gauge a viewer's response to an artist's work - your feedback is both gracious and appreciated.


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