More than 20,000 American mortgagees to hit Palm Beach as Naca's five-day mortgage modification marathon gets under way.
In the pre-dawn darkness of a steamy night of sub-tropical rain, a queue of anxious, soggy people snakes around the palm trees outside a cavernous Florida convention centre. Some have erected camp beds or makeshift tents. All clutch sheaves of mortgage documents.
Welcome to America's biggest jamboree of delinquent borrowers. For five days, the Neighbourhood Assistance Corporation of America (Naca), a not-for-profit organisation, is working round the clock to help homeowners hang on to their houses. More than 12,000 people have signed up in advance and more than 20,000 are expected to turn up, travelling from as far afield as California, Georgia and Maryland.
"It's either feed your kids or pay your mortgage," says Omayra Delgado, a 33-year-old special education teacher whose Miami house has slumped in value from $160,000 (£103,000) to $60,000. "My home is in foreclosure. I'm trying to keep it."
Politicians' talk of an economic recovery is laughable to many of those here. This is a last, desperate bid to cling on to home ownership – the event is shrewdly named "save the dream".
Inside, hundreds of loan advisers sit behind trestle tables. They are colour-coded: Bank of America workers wear red, Citigroup are in blue and Wells Fargo are in black. Even the moribund government-supported refinancing giants Fannie Mae and Freddie Mac are here, but their budgets don't run to natty coloured clothing.
Borrowers go through orientation and financial counselling sessions. Then, for the luckier applicants who can show a steady income, the loan advisers have the power to reduce interest rates or even write off a proportion of loans.
Bruce Marks, Naca's chief executive, says this is the only way to dig the nation out of the housing morass: "What you hear from the Obama administration is 'we're helpless, our programmes aren't working'. What you hear from Congress is 'we don't know what to do so we're going to do nothing'."
Every little adjustment is crucial, because for all the White House's hopes of a swift bounce back from recession, the US property market is showing signs of renewed distress. Some 10% of US households with mortgages are behind on their payments, according to figures last week from the Mortgage Bankers Association. The percentage of people beginning to have trouble with their loans has begun to rise again, after falling earlier this year – loans that are one month in arrears have gone up from 3.31% to 3.51%. And home sales in July were down 12.4% on June, dropping to 276,000 – the lowest since records began in 1963.
Radar Logic, a property data firm, says the usual summer uptick in property prices has barely happened this year. Thousands of repossessed homes have been put on sale by banks at knockdown prices, inhibiting any vitality in the market. "The inventory of distressed property for sale in this country is just staggering," says Radar Logic's chief executive, Michael Feder, who predicts an imminent "double dip" in housing. "There's just no momentum in pricing, no momentum in inventory."
The US treasury's efforts to help borrowers aren't bearing fruit. The government's "making home affordable" programme was supposed to protect 3 million homeowners from foreclosure. But the treasury admitted this month that only 422,000 loans have been permanently adjusted so far. The rate is slipping by the month and 616,000 trial modifications have ended in failure.
This outlook is alarming. In the same way the mortgage crisis pushed America into the worst financial storm since the 1930s, a fresh collapse in housing could scupper a fragile recovery that is barely taking root in the world's largest economy. Goldman Sachs puts the chance of a double-dip recession in the US at 25%. Mark Zandi, the chief executive of rating agency Moody's, has raised his view of the likelihood from 20% to 33.3%. Nouriel Roubini, the economic guru dubbed "Doctor Doom" for his early prediction of the credit crunch, reckons the probability is more than 40%.
Experts at Capital Economics predict that by the end of the crisis, as many as 4 million Americans may lose their homes: "Aside from the considerable social costs, this does not bode well for consumer spending, bank profits or the housing market itself."
Florida is an ideal spot for the latest in Naca's mortgage-altering marathons, which have also taken place in Washington, Atlanta, Phoenix and Las Vegas. The Sunshine State, beloved of British holidaymakers, is in property hell. About 45% of homes here are in negative equity, according to CoreLogic, a research firm, which calculates that Florida's stock of property is worth $859bn but has $771bn of mortgage debt outstanding.
Irresponsible borrowers are partly at fault. As Tea Party activists never tire of pointing out, property purchasers should not have taken on mortgages they were not able to afford. A CNBC presenter, Rick Santelli, articulated this view with an on-air rant that went viral on the internet last year, calling for a referendum "to see if we really want to subsidise the losers' mortgages", claiming government aid for strugglers "will make Thomas Jefferson and Benjamin Franklin roll over in their graves".
But irrespective of blame, many of those who have travelled to Palm Beach are simply desperate. Darnette Anderson, a receptionist whose husband, Kenneth, spent the night queuing, says her house, which she bought for $115,000 in 2004, was recently valued at $42,000. With her husband out of work, she cannot afford mortgage payments of $1,400 a month: "I just hope and pray that we can get this settled and move on to a comfortable repayment schedule."
Yrena Cruz, a Wal-Mart worker from Miami, says she and her boyfriend were sucked into an unrealistic mortgage by a low "teaser" rate which subsequently changed to an impossible amount – and the housing crash made it unfeasible to refinance. She said: "I'm worried sick. I can't wait to get this finished with. My house was worth $400,000. Now, it's probably half that."
Some come from surprising backgrounds. A Californian dentist, Dennis Jacobs, 65, flew 2,600 miles from San Diego to try to renegotiate a mortgage on his apartment. He sold his dentistry practice to pay off debts and is now working part-time. He is pessimistic: "I don't see any uptick in the economy at all. I think the unemployment figures are understated – there are large numbers of people underemployed."
The jobless rate in the US is 9.6% and has stayed stubbornly close to double figures in spite of Barack Obama's $787bn economic stimulus package. One reason, say economists, is that older people in states such as Florida are delaying their retirement to cope with straitened finances.
Naca's chief executive worries the US property crisis may have swung to the opposite extreme, with risk-averse banks reluctant to write even the most sensible of mortgages. Marks says banks "just refuse to lend" because they see no prospect of the "abusive" profits they once made. He is pessimistic about a short-term return to stability: "If somebody is used to getting intoxicated, to taking an extreme amount of drugs or alcohol, then they're never going to be satisfied with just a beer."
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