From the I-am-not-responsible-for-my-own-choices department, WebCPA reports that an Ohio man faced with foreclosure and outstanding tax liens on his business bulldozed his house to avoid turning it over to the bank:
Terry Hoskins bulldozed his home in Moscow, Ohio, after RiverHills Bank began foreclosure proceedings. “When I see I owe $160,000 on a home valued at $350,000, and someone decides they want to take it — no, I wasn’t going to stand for that, so I took it down,” he told local station WLWT.
The IRS had also filed tax liens against his carpet business and his commercial property after his brother sued him as a former business partner. The bank moved to foreclose on the home, even though Hoskins claimed he had received a $170,000 offer on the property from an interested buyer.
“As far as what the bank is going to get, I plan on giving them back what was on this hill exactly [as] it was,” he said. “I brought it out of the ground and I plan on putting it back in the ground.” He leveled the home two weeks ago with a bulldozer, and he is threatening to do the same with his carpet business, which is scheduled to go up for auction next month.
In addition to being a certifiable wacknut, Terry Hoskins is palpably stupid. By demolishing his house – which he says was worth $10,000 more than his mortgage – he cost himself (depending on the value of the land) more than $100,000.
A Little Lesson in Mortgages
When Hoskins bought the home he executed a Mortgage in favor of the lender which specifically allowed the lender to foreclose on the home in the event of a default. The bank would not have made the loan had Hoskins not signed the Mortgage. And, like all homebuyers, Hoskins signed the Mortgage because that was the only way the bank would lend him the money to buy the house.
Now, because the house has slipped in value, Hoskins believes he should not be made to repay the bank what he borrowed from it. But do you think he would have shared the appreciation with the lender had the house gone up in value? Of course, not. So under what bizarre notion of fairness does Hoskins now think the bank should absorb the loss on the depreciation of the home?
The Big Dangers of Victimization and Scapegoating
The actions of Terry Hoskins, like those of Joe Stack, the Austin tax bomber, show how dangerous it is for politicians to convince people that they are not responsible for their own choices and that their predicaments are the fault of the privileged rich, greedy banks and corrupt government officials.
History has taught us that when people are made to believe that they are being cheated, victimized and taken advantage of they are capable of all sorts of atrocities.
10 responses so far ↓
1 D Clasen // Apr 16, 2010 at 11:44 am
Sorry, the bank was stupid. They should have negotiated, delayed foreclosure and got their money.
Now they don’t really get anything but some ground.
Everything is negotiable.
Probably the guy wanted to get as much as possible and the bank would not negotiate. Therefore if he was going down he was not about to let them come out unscathed because they would not consider alternatives.
I see this same stupidity of the bank by materials suppliers in business. Some would rather move to close down a business, spend all sorts of legal resources and delay getting their money (or what’s possibly left) rather than request monthly payment plans, etc… to help the business keep going so they #1- get completely paid and #2 – retain a business customer for life.
So, I think you wanted to give a little lesson in mortgages and ideologies, and I guess I just gave you one on real life. File the bank response also in your “not-responsible-for-my-own-choices” department too. Some employee of the bank cost them money.
2 Peter // Apr 16, 2010 at 6:01 pm
D Clasen,
When non-Neanderthals borrow money, they pay it back.
Pay the bank back, man.
3 D Clasen // Apr 18, 2010 at 1:13 pm
When banks are stupid enough to loan money to Neanderthals, they should be a little smarter on getting it back.
Loan smarter, man.
4 Peter // Apr 18, 2010 at 4:16 pm
D Clasen,
When you buy a car and it goes down in value do you get to screw the lender? I don’t think so.
Entitlement is rationalized theft.
5 D Clasen // Apr 18, 2010 at 4:24 pm
I apologize that you aren’t understanding the reality… which is the guy wasn’t getting a negotiation session with the bank, was desperate (or as you say a Neanderthal) and made a decision.
The job of the bank employee is to successfully protect the joint investment – of which the bank’s employees failed miserably.
However, I’ll keep your perfect world scenario in mind for the future.
6 Peter // Apr 19, 2010 at 11:01 am
D Clasen,
I am no fan of the banks, but a simple mortgage transaction is not very difficult to understand.
The lender gives you money to buy a house and you agree to pay the lender back. The lender gets a mortgage on your house as collateral in the event you don’t pay it back.
The lender didn’t buy the house, you did.
When people buy houses and sign mortgage documents they perfectly understand the transaction terms.
It is only when things go bad that they claim they didn’t.
Take responsibility.
7 D Clasen // Apr 19, 2010 at 5:28 pm
I understand a simple mortgage. I even get the responsibility part.
You don’t get the bank has a responsibility to lend properly.
You don’t get the bank employee has a responsibility to get the money when something starts to derail.
Face the facts – the asset was destroyed by not enough smart thinking on both sides but the result is that both lose. Why did things go bad? Well, many reasons and banks are a huge part of it. Irresponsible lending and false markets. The bank got what was going to happen with the irresponsible climate.
The bank should have taken more responsibility. This is the same type of no-account loaning you get with the banks for SBA loans. Since the bank is only on the hook for a very small percentage they act like fools making deals.
It shouldn’t be a surprise to you when they get bit once and awhile.
Maybe now banks will go back to getting real down payments on housing purchases.
8 Peter // Apr 20, 2010 at 7:56 am
D Clasen,
No. The asset was destroyed by the borrower’s bulldozer.
9 The Home Mortgage Welchers: Making Other People Pay for Your Bad Choices // May 13, 2010 at 3:01 pm
[...] Man Facing Foreclosure and Tax Liens Bulldozes his House Bookmark & Share: [...]
10 D Clasen // Jul 18, 2010 at 7:03 pm
Glad I found this again.
OK Peter. You win… but you lost with your banker’s stance.
So, you make for a good banker and an extremely poor business man.
I would have found a way to have avoided the bulldozer situation and got a good portion (if not all) my money.
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