Foreclosing Lender is Not Happy Swallowing Insults

Posted on April 21, 2009
Filed Under Mortgage | 1 Comment

Although the foreclosing lender has been made out to be an ogre the person is not happy swallowing insults and jibes.

The story of Rick Williamson reflects the tendencies of the times. He was a banker in Chicago and then started buying junk loans. He began foreclosure proceedings against Fayetteville Athletic Club – a large gym and spa unit run by a family in Arkansas. Soon insults came flying and he came to be known as ‘Vulture Williamson’ and ‘Trash eating rat’.

Robert Shoulders who has been owning the club for nearly 13 years is not sorry about these expletives. He said, “What he does is reprehensible. I am not sure how he can sleep at night.”

Williamson sees the matter from a different angle and the government aggress with him. It is not the fault of Williamson that Shoulders took a bigger loan than he could manage. He took $10 million to shore up the gym, add a tennis court and put in more amenities changing the character of the modest club.

There have been many loan takers like Shoulders. Williamson has won a bad name by acting firmly on collecting these loans. He is playing an important part in clearing up the mess of bad debts that is choking the economy.

With force Williamson argues “If you want to fix what is ailing this country, you need to destroy the worthless debt out there. You have to shut down the zombies, liquidate their assets.”

But the people are not willing to reason. Clashes are taking place all over USA as banks are going through one of the worst days in the history of the country. Williamson buys at bargain minimum prices the commercial loans that are difficult to collect. These loans that he purchases have been auctioned off by the Federal Deposit Insurance Corporation (FDIC) after it seizes a bank that has collapsed. The Williamsons take on the most difficult loans – those that others are afraid to touch, in the hope lucrative returns in the future.

Across the country FDIC has taken over 58 banks during the last 5 months. Via loan auctions it has sold loans worth $2.2 billion. The money generated from the banks is funding the insurance of deposits in other banks. Many of these loans are performing – it means that the borrowers are current in their mortgage payments. But a good number are delinquent like the ones taken by Shoulders.

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