Oct 25, 2008

Mortgage Meltdown

to locate this image on the American Memory website use search terms SHANTY and MORTGAGENews from the financial markets has been grim recently. This photo, taken in Jan. 1939, recalls the Great Depression. The caption supplied by photographer Arthur Rothstein is of particular interest:

"A shanty built of refuse near the Sunnyside slack pile, Herrin, Illinois. Many residences in southern Illinois coal towns were built with money borrowed from building and loan associations. During the depression building and loan associations almost all went into receivership. Their mortgages were sold for whatever they would bring, and the purchasers demolished houses by the hundreds in order to salvage the scrap lumber.

"The result is serious overcrowding and high rents in all the coal towns. A number of people can find no houses to rent, and are living in tents and shanties on the fringes of the town."

That this website is currently auctioning foreclosed American homes with starting bids as low as $1,000 is a chilling echo of those times.

to locate this image, use search terms: shanty, mortgage