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Fighting Foreclosure: Home Is Where The Bank Says It Is

KUOW Photo/Kendra Hanna
Natalie Johnson in front of her new home.

Natalie Johnson and her family lived in their rental home in Edmonds, Wash., for seven years. It was the longest they had lived anywhere.

Then one day, Johnson came home to find a piece of paper with an 800 number posted to their door. She searched for the number online, which led her to the foreclosure department of a bank. The bank told Johnson that her house was going to be sold at auction.

Devastating, yes, but Johnson considered a silver lining: What if she bought the house?

Her family stopped paying rent and after six months of saving, they had enough to make a bid on their house at auction. Johnson thought they had a fighting chance, even though they were bidding against investment companies.

But it would prove harder than they thought. Foreclosure rates hovered near pre-recession rates, housing prices were the highestthey’ve been since the 2008 housing crisis, and investment companies were cashing in.

Fighting To Save Their Home

[asset-pullquotes[{"quote": "I thought maybe this is some great sign that we as the underdogs are going to somehow beat out these hedge fund companies.", "style": "inset"}]]Johnson is a stay-at-home mom, and her husband is a pastor. They have four kids. Their neighborhood in Edmonds felt like a small town to them. Johnson knew everyone and everyone knew her in a way she had never experienced. Kids in the neighborhood helped build the tree fort in her backyard, and her neighbor’s kid hung out at her house every single day. Saving this home meant hanging on to an idyllic way of life.

The auction took place on the steps of the Everett courthouse. There was a church across the street, and Johnson took inspiration from it. “Right as they started the auction, the church bells started playing Hallelujah," she recalled. "I thought maybe this is some great sign that we as the underdogs are going to somehow beat out these hedge fund companies."

But within a minute, the Johnsons were outbid. Their home was gone.

“I just lost it,” Johnson said. “It was awful. I’m sobbing. There’s all these businessmen standing around, and I’m like ugly crying: not like when you shed a tear. I’m sobbing, like you-just-stole-my-house sobbing.”

Johnson said the hardest realization was that she would have to move away from her friends. She choked up as she thought about it. “I borrow so many eggs and so much butter from them. I can’t even imagine how I’m going to be able to bake!”

A Seller’s Market

[asset-pullquotes[{"quote": "I offered to bake them cookies. Literally, we did everything.", "style": "inset"}]]Johnson didn’t want to live with the fear of another landlord foreclosing, so her family decided to buy a home. But by the time they started looking at houses, the market had become even more competitive. 

When Johnson made an offer on a home she made sure to make it as attractive as possible. She bid $22,000 over the asking price for a house her family loved. Even though the home was owned by a bank, and she was told her efforts wouldn’t help, she wrote a letter to support her family’s bid. “I wrote top 10 reasons why the Johnsons are the family to buy the house. And I made it really funny and I offered to bake them cookies. Literally, we did everything,” she said.

But then the call came, and they had been outbid.

“That was awful, because we had taken the kids over," Johnson said. "We were new to this, and we thought, ‘Hey let’s look at houses and bring the kids.’ So we loved it and they loved it. They had mentally moved in and picked their rooms; I was already baking in the double ovens in my head.”

It felt like the auction house all over. She started looking at houses again, but this time she didn’t take the kids. Time and time again she was outbid — six more times. Johnson was panicking. Prices were going up, and she had a deadline to be out of their Edmonds rental house.  

She persisted and finally, on the eighth house, her offer was accepted. 

New Furniture

The bank called at 4 p.m. The paperwork had gone through, and they had closed on the house. The Johnsons got the keys and were able to take ownership of their new home.

It’s a three-bedroom house with a big downstairs, in between Lynnwood and Everett.

Johnson sat on her living room floor, assembling a pair of brand new coral chairs. These were the first pieces of new furniture she had ever bought. “Beautiful new chairs for my beautiful new house,” she said. “I’m so excited!”

This story originally aired on September 2, 2013.