Foreclosures Hit Even The Famous

June 16, 2008 2:26 pm Published by

As I’ve often remarked in this bankruptcy blog, it can happen to anyone. Medical problems combined with job loss can be difficult to overcome, even for very fiscally responsible folks.  And when falling real estate values make it impossible for a family to cut costs by downsizing – that can be a recipe for financial disaster.

As a bankruptcy attorney in Indiana for many, many years, I‘m an avid reader of news. I need to know all I can about the economy in order to offer advice about financial decisions.  On quite a few occasions, I’ll see a feature about some celebrity undergoing financial difficulties.  Interesting – I never, ever derive satisfaction out of hearing that some once very successful and very wealthy person has fallen on hard times.  Quite the contrary.  I of all people know how quickly fortunes can turn.  The only reason I pass on celebrity stories to my bankruptcy clients and to my readers is so people will know they are not alone.

When I read recently that eighty-five year old Ed McMahon (Johnny Carson’s sidekick for so many years) is in danger of losing his home to foreclosure, I didn’t ask “How could that happen?”.  I understood only too well.  A year and a half ago, I remembered reading, McMahon had his neck broken in an accident, and needed to quit working for American Family Publishers Clearinghouse sweepstakes.  With what I imagine are enormous medical bills to pay and severely reduced income, McMahon fell behind on his mortgage payments.  Yes, I know we’re talking about a multi-million dollar mansion, not an ordinary home.  But the story – it’s the same as with millions of other homes right now.  The McMahons’ home has been up for sale since the accident, but it hasn‘t sold.  The McMahons are caught in the same real estate crunch that’s affecting so many, many other families.

There is one very important detail in the Fox News story I read about McMahon.  According to his spokesman, McMahon has been in discussions with his lender to resolve the situation.  Whatever the outcome of those discussions, I want my readers to pay attention to this point: No one should allow a foreclosure to proceed without having a professional at least attempt negotiating with his or her lender.  In fact, this is a crucial part of the work I do with clients facing foreclosure or bankruptcy.  And the earlier in the process we start, the better chance we have of reaching some sort of settlement.

My thoughts and good wishes are with the McMahons as they go through this difficult time in their lives.  Meanwhile, the two thoughts I want to share with my Indiana bankruptcy clients are these:  “Get help.”  and “You’re Not Alone!”

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This post was written by Mark Zuckerberg

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