Ed McMahon Faces Foreclosure

Think this mess is contained to subprime, Alt-A, and flippers? Think again: Ed McMahon May Lose Beverly Hills Home.

Ed McMahon, the longtime sidekick to television star Johnny Carson, faces the possible loss of his Beverly Hills home to a foreclosure action initiated by a unit of Countrywide Financial Corp.

Mr. McMahon, a jovial fixture of American television for decades, is one of the most prominent people caught up in a wave of mortgage defaults that has devastated low-income areas, suburbia and even a few posh gated communities, such as the one where the McMahons live. U.S. Rep. Laura Richardson, a California Democrat, recently lost a home in Sacramento to a foreclosure. Rep. Richardson didn't respond to requests for comment.

Mr. McMahon's home has been on the market for about two years, his real-estate agent Alex Davis said. Mr. Davis said the price had been reduced, but he couldn't immediately provide details. The Christie's Great Estates Web site, which includes homes listed by Mr. Davis, lists the asking price at $5.75 million and says it has a canyon view and a master-bedroom suite with his and her bathrooms.

Mr. McMahon broke his neck in a fall about 18 months ago and hasn't been able to work, Mr. Bragman said. That health problem, along with the weak housing market and economy, has forced Mr. McMahon into foreclosure proceedings, Mr. Bragman said.

The McMahons "understand that they are in the same situation as hundreds of thousands of other hard-working Americans, and their hearts go out to them," Mr. Bragman said.

Whoa!

Why should an 85 year old former TV star of Johnny Carson show need to work at 85? Something went very wrong here. McMahon should have been set for life. Perhaps there are some medical or personal problems I am not aware of but this should be enough to give everyone pause to think. Where will you be at 85?

Foreclosures Take Hamptons By Surprise

This is not an isolated random event either. Please consider Foreclosures taking Hamptons by surprise.

Paul Brennan never handled a short sale - and barely ever used the phrase - until about six months ago.

But since then, Prudential Douglas Elliman, where Brennan isThe Hamptons regional manager, has handled about 10 short sales across the South Fork, he said. In a "short sale," homeowners who want to avoid foreclosure agree with their banks to sell their homes for less than the mortgage amount.

"It is a new phrase for me," said Brennan, who has worked in real estate in The Hamptons for nearly 30 years.


"It is a new phrase for me," said Brennan, who has worked in real estate inThe Hamptons for nearly 30 years.

Mortgage defaults, foreclosures andThe Hamptons were words that until recently were never mentioned in the same breath. Defaults and foreclosures took place elsewhere. But over the past year across the East End there's been a noticeable increase in "lis pendens" - the first legal foreclosure notice - and even foreclosure auctions, which take place in courtrooms or on town hall steps. Among the houses in the initial stage of foreclosure is one now on the market for $19 million in very upscale Bridgehampton.

No neighborhood is safe'

Two years ago, local newspapers' legal notice columns would be devoid of any mention of a legal default notice or foreclosure auction inThe Hamptons, said Ashleigh Clark, the data acquisition manager for PropertyShark, a Brooklyn-based firm that gathers and publicizes real estate data.

Now, there are one or two such notices a week on homes inThe Hamptons, Clark said. "It's small in actual numbers and in comparison to the rest of the country, but it's a big change for that particular area," Clark said. "It's indicating that no neighborhood is safe."

"In the last six to eight months, my calls have doubled and the amount of clients I have coming in to see me has doubled," said Southampton bankruptcy and real estate attorney Alan C. Stein. "People look at the East End and they think it's just money, but I've got clients that are on the verge of foreclosure in $3 million homes and they're scraping together pennies just to make their mortgage payments."

Among the houses in this initial phase of foreclosure is the 2006 Hamptons Designer Showhouse in Bridgehampton. The mansion sits on four acres alongside Sagg Pond. The house is on the market for $19,995,000.

When it comes to the upper crust, this is only the first inning. Eight innings to go.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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