Presidential hopeful Mitt Romney spent nearly an hour talking to struggling home and business owners Monday morning in Florida, the next stop in the Republican primary contest and one of the states hardest-hit by the foreclosure crisis that wrecked the economy in 2007.
At a round table in a Tampa, Fla. hotel, Candice Tammey told Romney about how she'd lost her job in the staffing industry three years ago and eventually stopped paying her mortgage after her bank wouldn't negotiate a loan modification.
"I'm going to be living in my home until I'm kicked out. I don't have a choice at this point," she said, adding that employers seemed "inundated" with other job applicants. She said she had her health and that she's keeping a positive outlook. "There's light at the end of the tunnel," she said. "I don't see it quite yet but I know that it's there, so I'm encouraged -- I know that there's something better out there for me and for us as a country."
"It will get better," Romney said, according to CNN's online video stream of the event. "It will not always be like this. This is a detour from America's history. ... I can't predict when it will get better but if I'm fortunate enough to become president, I will care very deeply about getting it better in a big hurry."
It's the first time Romney's talked foreclosures since he told the Las Vegas Review-Journal that the only thing the government should do is get out of the way.
"Don't try to stop the foreclosure process. Let it run its course and hit the bottom," Romney said last October. "Allow investors to buy homes, put renters in them, fix the homes up and let it turn around and come back up. ... The Obama administration has slow walked the foreclosure process ... that has long existed and as a result we still have a foreclosure overhang."
Romney stuck to that message as homeowners told him of their struggles.
Richard Wood of Bradenton, Fla., told Romney he'd folded his title insurance company in October 2010. "I invested in some real estate, some rental properties, made what I considered to be very conservative investments during the boom times and right now I am negotiating with the same bank who has mortgages on each of those and an approximate $200,000 deficiency," he said. "We have been exploring the possibility of moving to another to another country where we might be able to live on our retirement and our Social Security."
"Yeah. It's just tragic, isn't it? Just tragic, just tragic," Romney said. "We're just so overleveraged, so much debt in our society, and some of the institutions that hold it aren't willing to write it off and say they made a mistake, they loaned too much, we're overextended, write those down and start over. They keep on trying to harangue and pretend what they have on their books is still what it's worth."
"Also, Gov. Romney, we got hit with a double whammy," Wood continued. "My wife, she's a Realtor -- she is in the process of filing for bankruptcy on some debts that she needed to take out in order to try and stay in business the past five years. I'm probably right behind her."
"That's tragic," Romney said. "In some cases, if the debt is not in something you can service, it's like you have to move on and start over away from those debts. It's helpful if you get an institution that's willing to work with you, but if you don't you have no other option."
The Sunshine State had the seventh-highest foreclosure rate of any state in 2011, according to RealtyTrac, an online foreclosure marketplace and data firm. All of the homeowners at the table Monday said they owed more than their homes were worth and that their banks wouldn't negotiate on modifications or refinancing. More than 22 percent of all residential properties in the U.S. are "underwater," according to housing research firm CoreLogic. In Florida, a full 44 percent of mortgage properties are underwater.
"The banks are scared to death, of course, because they think they're going to go out of business," Romney said. "They're afraid that if they write all these loans off, they're going to go broke. And so they're feeling the same thing you're feeling. They just want to pretend all of this is going to get paid someday so they don't have to write it off and potentially go out of business themselves."
"This is cascading throughout our system and in some respects government is trying to just hold things in place, hoping things get better," Romney continued. "My own view is you recognize the distress, you take the loss and let people reset. Let people start over again, let the banks start over again. Those that are prudent will be able to restart, those that aren't will go out of business. This effort to try and exact the burden of their mistakes on homeowners and commercial property owners, I think, is a mistake."
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