Former Romney home to be demolished

**DetroitZack** · May-15-10, 06:50 AM

George Romney's former house in Palmer Woods is on the cities demolition list. I think this is ridiculous, so many burnt out houses in the city and they want this nice 5,500 square-foot house taken down.

Check out the article for pictures.

http://www.detnews.com/article/20100...emolition-list

**Patrick** · May-15-10, 07:56 AM

In 2001, the house sold for $645,000

That has to be a typo. There is no way that house was worth that much back then. I remember driving by that home back in 2000 and it looked rough then. I wonder just how much water damage has been done.

**oldredfordette** · May-15-10, 07:59 AM

It's a symbol for Mitt, I'm sure he wants it torn down more than anybody, well before the next election cycle.

**brandon48202** · May-15-10, 09:52 AM

This house was purchased by GARNER GUYTON,PATRICIA K for $645,000 on August 21, 2001 according to the public records.

DC48080 · May-15-10, 10:17 AM

Originally Posted by oldredfordette

It's a symbol for Mitt, I'm sure he wants it torn down more than anybody, well before the next election cycle.

How is it a symbol for Mitt Romney? His family moved out of that house 57 years ago, when Mitt was only 6 years old. Nobody with any common sense at all would connect what happened to that house to him.

I think you're reaching extraordinarily far on that one.

**Bobl** · May-15-10, 10:45 AM

From The Detroit News article:
"...In 2001, the house sold for $645,000. But it changed owners several times since and sold for $150,000 in 2007. A tattered blue tarp now hangs on the 5,500 square-foot house, whose front windows are boarded with plywood. A condemnation sign is tacked to the front door...."
Who would have believed that a home like this, in a wealthy neighborhood of a major American city, would end up this way, if this item was printed in 1960?

**Johnnny5** · May-15-10, 10:58 AM

Originally Posted by Patrick

That has to be a typo. There is no way that house was worth that much back then. I remember driving by that home back in 2000 and it looked rough then. I wonder just how much water damage has been done.

I wouldn't doubt if it was a part of a mortgage related scam. Mortgage the house on an inflated appraisal, let it go back to the lender and split the "profit" with the seller, appraiser, and others involved.

**Patrick** · May-15-10, 11:21 AM

I wonder how much damage this hosue really has. A tarp over part of the roof is a bad sign since water can do so much damage. I think it's right next to the Bishop's mansion if I am not mistaken.

**n7hn** · May-15-10, 12:29 PM

Kinda shows that Money talks ....... people in the neighborhood wanted it gone, and since Im sure they pay ALOT of taxes, they got it pushed to the front.....It is a real shame tho. I agree it was probably real estate fraud and an inflated mtg the buyer planned to skip out on. Seen alot of what appears to be that [[scam) in looking thru records.....really sad

**brandon48202** · May-15-10, 01:52 PM

Originally Posted by Johnnny5

I wouldn't doubt if it was a part of a mortgage related scam. Mortgage the house on an inflated appraisal, let it go back to the lender and split the "profit" with the seller, appraiser, and others involved.

It doesn't look like a mortgage scam, the lady who paid $645,000 struggled with the mortgage for almost 3 years before the house went through foreclosure. Typically with mortgage fraud you see the property go through foreclosure quicker. Inflated appraisal? I don't think so- back in 2001 when the mortgage was originated that was what houses were going for in Palmer woods.

**Whitehouse** · May-15-10, 02:56 PM

Let's be honest. If you see the houses surrounding this property, you might understand why they are complaining about this ongoing rebuild project.
Seeing that link the blue tarp is still more or less in place, a far cry from the current situation.

**n7hn** · May-15-10, 04:08 PM

Originally Posted by Whitehouse

Let's be honest. If you see the houses surrounding this property, you might understand why they are complaining about this ongoing rebuild project.
Seeing that link the blue tarp is still more or less in place, a far cry from the current situation.

Im not saying they shouldnt complain, Im just saying how much more effective it was. I also think Its wise to include areas like Sherwood forest to maintain the integrity of the neighborhood, on the other hand Im sure it is costing what it would remove 10 war bungalows out of brightmoor

I hate to see Sherwood Forest slowly chipped away at.

Brandon, I agree , sounds like they tried. A home i owned once later became Part of a scam, It went into foreclosure in less than a year, so you know they never paid anything.....

**DetroitZack** · May-15-10, 06:55 PM

Demolition of this home, and the many others coming to the city made a Wall Street Journal article.

http://online.wsj.com/article/SB1000...mostcommentart

**Patrick** · May-15-10, 07:29 PM

Here is a quote from that WSJ article. below. So, wat is to be done with all that empty space? That is the question...

When it's all over, said Karla Henderson, director of the Detroit Building Department, "There's going to be a lot of empty space."

With regards to the house...it really doesn't make economic sense to spend all that money on it, at least that is what one PW resident mentioned in the article. If the William Fisher mansion lot can remain empty for 15 years, so can this lot.

DC48080 · May-15-10, 08:43 PM

I dorve by that house this afternoon. There is no roof on the house, all of the slate has been removed [[stolen, scrapped?). The blue tarps are just hanging off of the side of the house. The interior damage is extensive. It is a complete wreck.

All of the surrounding houses are well-kept and beautiful. This piece of crap needs to be removed. It is a disgrace to the neighborhood.

Palmer Woods is one of the few stable neighborhoods left in Detroit. It cannot be allowed to disintegrate the way much of the rest of the city has.

**Zacha341** · May-16-10, 07:04 AM

Yep, that was a common "mortgage" hustle. It was all about the commission when that thing was at full swing. Ugly indeed.

Originally Posted by Johnnny5

I wouldn't doubt if it was a part of a mortgage related scam. Mortgage the house on an inflated appraisal, let it go back to the lender and split the "profit" with the seller, appraiser, and others involved.

**Zacha341** · May-16-10, 07:09 AM

Yeah, that sounds about right. The replacement of the slate roof would have been cost prohibitive once the rest of the house went down hill from no roof at all. Then add the quotient of the "scrappers"... it's over. It must be torn down. Very, very sad.

Originally Posted by DC48080

I dorve by that house this afternoon. There is no roof on the house, all of the slate has been removed [[stolen, scrapped?). The blue tarps are just hanging off of the side of the house. The interior damage is extensive. It is a complete wreck.

All of the surrounding houses are well-kept and beautiful. This piece of crap needs to be removed. It is a disgrace to the neighborhood.

Palmer Woods is one of the few stable neighborhoods left in Detroit. It cannot be allowed to disintegrate the way much of the rest of the city has.

**Zacha341** · May-16-10, 07:17 AM

A house this big in this bad of shape must come down sadly. There was a huge four-family quad brick house on the block I live in near WSU that had a tarp over it for 3 years. The so called "owners" just kept jacking around, while the rain came in along with the scrappers initially.

After a point the thing rotted down thru to the basement and even the "scrappers" did not want to deal with if for fear of it caving in as the removed the last batch of bricks from the foundation. As the tarp finally shredded, peaces of it it blew down the street onto other roofs!

It was really ugly, and was finally torn down after many calls and complaints...

Originally Posted by Patrick

I wonder how much damage this hoise really has. A tarp over part of the roof is a bad sign since water can do so much damage. I think it's right next to the Bishop's mansion if I am not mistaken.

**mjs** · May-16-10, 02:55 PM

The last line says it all. "Who wants to spend $1 million on a house so it will be worth $400,000?" If someone disagrees with that assessment, get out your check book and sign a rehab agreement with the city. The city rehab agreements say you must make significant progress in six months or you forfeit the property and money paid for it. Otherwise, get out of the way of the people who are doing their jobs.

The plan is to rehab 3000 properties in the first year and there are 100,000 abandoned properties. Thats 33 years worth! More than enough opportunity for rehab and preservation of tens of thousands not yet on the city's list. Its an overwhelming task that has to start somewhere and this is the best plan I've heard. We can't allow a system where every building the city tries to take down has to be a major battle. 50 years experience has shown that doesn't work. I applaud the Mayor's efforts and believe we should all do everything we can to support it.

**mjs** · May-16-10, 03:48 PM

The mortgage hustles can also be greatly reduced with some effort from the county and feds.

First, the feds need to prosecute agreat deal more of them. Prosecuting mortgage scams is very expensive so they rarely get prosecuted at the local level. Last I heard, the state wouldn't prosecute them and Wayne County was the only county that has even considered prosecuting them. Victims have said that DPD won't even take a complaint because they feel its a civil matter. A great many of these are FHA loans. If the government wants to be in the lending business, let them protect their loans.

Second, there's very little repercussions for flipping fraudulent or misrepresented loans to other lenders. So, most of the fraud doesn't get reported because its better for the lender to hide it. Why? Because hiding it allows them to bury it in a bundle of loans they sell to another lender or better yet, to the public through mortgage mutual funds known as REITs. Even if they can't sell it, as long as they don't foreclose on it, they can still claim the asset is worth the value of the loan rather than the value of the property. Loans can sit in this status for decades. These are many of your "abandoned" homes.

The first part could be addressed by a federal law saying that if you sell a mortgage you've held for less than a year and it goes into default within a year of selling it, you are liable for a portion of the loss. I know the objection, but there's no benefit to society or the integrity of the lending process in encouraging multiple rapid loan flips. The second part could be addressed with a SEC rule that if there's been no payment made on a loan for six months, the asset must be valued at FMV.

Finally, Wayne County needs to get in line with the rest of the country and record their deeds in a timely manner. In Oakland County, a deed will appear in the records a week to three weeks after its filed. In Wayne County, its six months to a year. Thats the opening that makes Detroit so prone to mortgage fraud. If a property has been sold multiple times in the last year and the value keeps rising, its a flag of potential fraud. Long recording times make it very difficult for loan officers, loan purchasers, and out-of-town heirs to find issues before it too late.

**Patrick** · May-16-10, 03:50 PM

Anyone know the history of this home prior to the Romney chapter? Architect? year built?

**DetroitZack** · May-16-10, 06:34 PM

It was built in 1918. Here are some pictures from today as well as picture of the houses next to it.

**DetroitZack** · May-16-10, 06:35 PM

**CLAUDE G** · May-17-10, 04:03 AM

Although I hate tearing anything down, I think this house needs to go!

**swingline** · May-17-10, 10:13 AM

Originally Posted by brandon48202

It doesn't look like a mortgage scam, the lady who paid $645,000 struggled with the mortgage for almost 3 years before the house went through foreclosure. Typically with mortgage fraud you see the property go through foreclosure quicker. Inflated appraisal? I don't think so- back in 2001 when the mortgage was originated that was what houses were going for in Palmer woods.

It's extraordinary that a non-fraudulent borrower would actually purchase that home for $645K and then try to make the payments. Palmer Woods is an expensive neighborhood for Detroit, but that price, even in the go-go days, would be one of the top 10 or 20 sales prices -- ever in that neighborhood. Any legitimate sale that has ever occurred in Palmer Woods for $600K or more has been for something turn-key. There's no way that place was close to turn-key, even way back in 2001-02.

Questions: Other than the lag time for the foreclosure after the $645K sale, is there any other evidence that payments [[which had to be in the $4000/mo. range) were actually made? Was the $645K sale a flip? A flip from, say, something like a $200K sale six months previously. If so, the flipper/mortgage fraud guy could throw off law enforcement by making 18 months of payments, and then paying for $25K in half-ass initial renovations, and then still walk away with $250K - $300K.

It's hard to believe that the $645K wasn't fraud. If it wasn't fraud, both the lender and the borrower were pretty dumb, to put it charitably.