BROOKS, Maine — When Barry Feero was a student at Old Town High School back in the 1970s, he loved to run.
He remembers loping the 10 miles from his house in Alton all the way to Governor’s Restaurant in Stillwater for ice cream. Sometimes he’d even jog back.
When Feero ran, he felt peaceful, and removed from the tensions of his life.
“Running was a way for me to get away from it all,” he said last week, a wistful gaze in his bright blue eyes. “I was by myself and free.”
Now the Brooks man is fighting foreclosure on the simple, four-room house where he lives, and once again he is searching for peace.
This time, he won’t find it by running.
“I’m going to be crushed if I lose this house,” Feero said, looking around his sparsely decorated living room. “I’m 52 years old. If I lose this, I’m done.”
The threat of foreclosure has changed everything. Although the wild turkeys still come up to his back windows hunting for birdseed and the roof is extravagantly frosted by a February snowstorm, what once was his sanctuary has become a terrifying source of stress.
“I know this ain’t much. It’s no mansion,” he said. “But it’s my home.”
Shrinking home values
Feero is a friendly, talkative man with salt-and-pepper hair and a neatly trimmed mustache. Thanks to a twisted trail of loans and refinancing that his lawyer calls predatory and downright illegal, Feero owes $125,000 on a house and 3.5 acres most recently valued at $82,000 by the town of Brooks. Since 2004, his mortgage payments have jumped from $590 a month to $1,170, which would be quite a feat to pay on his $1,400 fixed income.
He’s underwater — he owes more than his house is worth — and though the dollar figures in his case might seem shocking, experts say that he is in no way unique. Instead, he’s one of a growing number of Mainers who are part of the nation’s housing crisis.
According to a January report from the Center for Responsible Lending, Maine’s 3.19 percent foreclosure rate exceeds the national average and is the highest of all the New England states.
“The wave of foreclosures in Maine shows no sign of quelling,” the report warns. “Nearly one in 20 of all Maine loans is seriously delinquent.”
“We’re in such a crisis,” said Carla Dickstein of Coastal Enterprises Inc., a nonprofit group that does housing advocacy in Maine. “The bubble has burst. The market continues to fall. It’s affecting everybody — it’s affecting property values and the economy in general.”
Her agency sounded an alarm about the state of Maine’s mortgages two years ago and worked to pass a law against predatory lending, which took effect in January 2008. It’s one of the strongest such laws in the country, but it was passed too late to help Feero.
Mortgage ‘musical chairs’
After a lifetime of renting, Feero decided to buy a piece of property in 1997, and the wooded parcel off Bog Road in Brooks looked good to him.
“It’s like being out in the wilderness,” he said. “I love the land, as long as I can hold on to it.”
Feero has been on Social Security disability since the 1980s, when he hurt his back in a fall at Bath Iron Works. Years later, after he bought his land, he asked friends to help him build a one-room camp with no plumbing and no electricity.
“At that time, I only owed $8,000 and my credit score was real high,” he said.
Then he decided to add three rooms to make it more comfortable. In retrospect, Feero sees this as a mistake.
“I wish I never did the loan,” he said.
At first, he borrowed $90,000 to build onto his home from a nonbank mortgage company. It was 2005 and it seemed as if the national housing bubble would never pop. Feero’s mortgage was passed from company to company and rewritten five times in five years. It was a dizzying case of what Dickstein calls mortgage “musical chairs.”
“Eventually someone gets stuck without the chair,” she said.
41-year mortgage at 10.4%
The last time Feero went for refinancing, he borrowed $122,000 at a fixed 10.4 percent rate. It was a 41-year mortgage — and if Feero had made every payment, by the time he was 90 and had paid a total of $517,580, he would have owned his property free and clear.
“You just listen to them, and they tell you this is how it works,” he said.
He signed documents, paid tens of thousands of dollars in fees and agreed to the usurious terms of the new loans — terms that left him just barely scraping by.
“I barely had money for gas and groceries,” he said. “I’m just so frustrated with the whole system. I was scared to death.”
But is Feero entirely to blame for the financial mess he found himself in?
Dickstein and Feero’s lawyer, Shawn Leyden of Augusta, don’t think so.
“You have to remind people that a mortgage is a really complicated thing,” Leyden said. “Most people don’t understand what a mortgage means. A lot of people have brokers who are supposed to be helping them. You don’t understand what you’re signing. I’ve seen a lot of smart people get into really bad mortgages. As for Mr. Feero — after a certain point, he got stuck. He was desperate to save his home.”
Leyden said she has heard from a lot of people who say that they have a mortgage with reasonable terms — and why should the country have to help people like Feero who don’t?
“If you have a good loan, be thankful,” she tells them. “Yes, these people [like Feero] made poor decisions. But it wasn’t a few mortgages here and there. It was an amazing undertaking by multiple organizations to target these different individuals who didn’t qualify for a bank loan.”
Leyden said that she and Rich Goldman, the attorney she works for, have about 200 foreclosure cases between the two of them. She is “cautiously hopeful” that the massive $75 billion plan unveiled last week by President Obama will succeed at keeping millions of Americans from foreclosure.
“It was such a widespread illegality that was allowed to take place everywhere. It was so overwhelming, and awful, that a massive response is necessary,” Leyden said.
Negotiating a better deal
Leyden is trying to work with Feero’s latest lender to make a new, reasonable payment plan, one in which he pays around 30 percent of his net take-home pay.
“We have seen some good modifications and gotten results,” she said.
She encourages people with a bad mortgage to reach out for help, through free or low-cost legal clinics, lawyers with experience in mortgage law or housing authorities.
“It can cause an amazing amount of stress and anxiety, it can affect people’s marriages, it can lead to divorce, it can affect the children.” Leyden said of having a bad mortgage. “You read about people committing suicide. It’s someone’s home, and for some people, that’s all they’ve ever had and all they’re going to have. The idea of losing that is unthinkable.”
In Feero’s home, the source of all this struggle, he looked out the window and saw a chickadee nibbling at one of his bird feeders.
“Look how peaceful this is,” he said. “I’d like to save this for my granddaughter. I’d like to leave her something.”
For information on foreclosure counseling, contact:
Paula Fontes, Pine Tree Legal, 942-8241, ext. 209, or visit the Web site www.ptla.org.
Coastal Enterprises Inc., 882-7552 or 877-340-2649, or visit the Web site www.ceimaine.org.
U.S. Department of Housing and Urban Development, www.hud.gov.