Usually it is effective, but assumes some demand for the property. Currently there are all sorts of “back room” problems. Most mortgages are insured and there are hoops to recover the insurance. I suspect many banks are waiting for the “bail out” of “toxic mortgages”. Barney Frank keeps hinting that the taxpayers will buy out the lenders.

Worse, for so many years it was possible for anyone “who could fog a mirror” (banker’s phrase) to get a mortgage. These mortgages were unrelated to actual values. So, “values” soared. This went on for so long that people began to believe these were the actual “values”. No one is willing to accept it was a “bubble” (read the history of the “Tulip Mania”). Most of the properties I see here have a “real value” of $20-50,000. I arrive at that by estimating renovation costs and code compliance costs, then figuring what amount of investment could be supported by the rents which can realisticly be obtained and still leave some profit. I am not figuring Section 8 rents, which are pegged at 20% above market.

I know of several instances (in Boston) where the bank allowed the owners to stay in 3 deckers and pay rent until it was sold. They also paid them a “bonus” for moving costs when they moved out.

I’m guessing that the furnace was stripped by the owner to try to recoup some of the investment he put into those properties (they were completely renovated a few years ago). Should be laws to punish this sort of behavior.

I suspect you are right about the owner. There are laws about this, the furnace belongs to the bank and it is theft. Law is like a wheelbarrow, if no one pushes it, it doesn’t go anywhere. There is a problem about wittnesses and police departments don’t see themselves as “collection agencies” (they love that phrase).

It is time we stop expecting the government to “take care of us”. Those are the same sort of people who took 5 days to get water to the stadium in New Orleans.