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Boston real estate: There’s more to the story

In this month’s Boston Magazine there’s an article regarding Boston real estate foreclosures. The article starts off with:

Screwed by the mortgage companies, blasted by the real estate bubble, and hung out to dry by the government, angry Boston homeowners are banding together to fight back…..

The story goes on to feature Ms. Drusilla Francis and her home located at 197 Normandy Street in Dorchester. The reporter describes a sad story, and you’d have to be cold-hearted not to be troubled by her plight.

When you read the story, remember this: What the Boston Magazine article doesn’t say:

The mortgage history of Ms. Drusilla Francis home at 197 Normandy Street, Dorchester Massachusetts.

197 Normandy purchased by Drusilla Francis for $81K

$77K as 2 mortgages

$127K mortgage

$170K mortgage

$180K mortgage

$204K mortgage

$265K mortgage

$454K mortgage

Foreclosure sale at $243K (Where she buys it back)

And the cycle begins again…

$295K mortgage for Drusilla Francis with cosigner

The mortgage history of 197 Normandy Street since 2003:

$265K mortgage (National City Mortgage)

$364K mortgage (First National Bank of Arizona)

$454K mortgage (WMC Mortgage Company)

$460K mortgage (Downey Savings and Loan)

Foreclosure sale at $243K

$295K mortgage for Drusilla Francis with cosigner (Aura Mortgage Advisors)


Hat tip: Richard Smith

Read other posts about: Boston real estate condos news

7 Responses to “Boston real estate: There’s more to the story” »»

  1. Comment by Mike | 11/15/11 at 4:46 am

    But John, banks are bad! We all know this! They are the source of the problem, not poor struggling homeowners who just want to cash out refinance their homes. Those homeowners deserve the $200,000 of value they’ve extracted from their homes – how can we expect them to repay it when other people are making so much money?

    Sigh. Awesome post John, although a bit disheartening.

  2. Comment by Boston Condo Buyer Broker | 11/15/11 at 10:35 am

    Don’t blame the Boston homeowner. Where was the banking fail system safeguards? The banks deserve to take a bath on this loan.

    Jess..what a mess

  3. Comment by Rich | 11/15/11 at 10:49 am


    The last 4 banks that gave mortgages on the property are now out of business. Downey Savings and Loan, who gave the final $460K mortgage in 2006, was taken over by the FDIC in 2008 and sold off to US Bank. It cost the FDIC insurance fund $1.4 billion to clean up the mess at Downey.

    So the losses at 197 Normandy were ultimately paid for by the stockholders of the Downey bank and the FDIC insurance fund. A lot of employees at Downey paid a price also by losing their jobs. Not all of these people were part of the subprime machine at Downey.


  4. Comment by Mike | 11/15/11 at 11:51 am

    Hi BCBB – the only problem with what you suggest is the consequence will likely be (or has become) that banks are unwilling to lend to all but the highest quality borrowers, thereby restricting home ownership. This will hit the lower socioeconomic strata disproportionately hard. It’s this concern that led to the creation of Fannie/Freddie/Ginne, not to mention CRA. They are certainly a big part of the problem, but at some point the homeowner needs to be held responsible as well.

    The saddest part of the situation? Borrowers like the one in the article, looking to cash out and not thinking it through have ruined it for the lower income people who ARE fiscally responsible. It sucks.

  5. Comment by Mike | 11/15/11 at 11:55 am

    My gripe with the article is they paint Drusillia as representative of the people who got screwed by banks. She’s not. She got $200k out of the deal. The REAL cases, the ones that SHOULD receive attention, are the hard working people who just wanted a place to live, rather than a piggy bank, and got caught paying inflated prices and have since lost their life’s savings. THOSE are the people City Life should be helping. Not someone who cashed out $200k and blew it all and now has nothing left to pay the mortgage.

  6. Comment by Boston real estate reader | 11/15/11 at 1:20 pm

    Hmm…How did the editor of Boston Magazine allow this article to be published without a simple backround check of the facts. My thoughts: Shame, Shame, Shame.

  7. Comment by Funny | 11/16/11 at 2:40 pm

    “At some point the homeowner needs to be help responsible”

    Sure, but if the fallout was limited to the homeowner (and even the lender), we wouldn’t be in the mess we’re in right now. The huge problem was these loans were then packaged into AAA rated MBS’s, which amplified their destruction (and profit margins before the floor fell out).

    Ultimately, they were bad loans and they were given out like candy to a baby. It’s the responsibility of the lender to give out loans that make sense and are financially sound. These never did, unless they were offloaded onto somebody else. Then it became their problem. That was the name of the game.

    Your also confabulating CRA and subprime loans. I’m willing to bet these loans were not CRA backed, but subprime.

    The default rate of CRA backed loans is statistically insignificant compared to prime loans.

    Subprime and Alt-A loans are significantly higher.

    This has less to do with “poor people” and more to do with bad financial decisions from start to finish.

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