The foreclosure rate in Isanti County is the second highest in the state. In a county where less than 40,000 people live, more than 588 families have lost their homes to foreclosure since January 2009.
The recession's disproportionate impact there can be explained by two things: New homes bought with treacherous mortgages at the height of the boom; and the high proportion of workers who used to commute to the Twin Cities for work, and have lost their jobs.
ONE FAMILY'S FALL INTO FORECLOSURE
Shawn Miller's situation reflects both those problems. The house where Miller lives with his wife and two children is just four years old. It's a four-bedroom split level on three-quarters of an acre in a new development of similar homes in Cambridge, Minn.
Miller is a licensed plumber who used to have a company called Over-All Plumbing. In 2006 he was working 90 hours a week supervising "his guys," and buying uniforms and vehicles to build his business. Most of his clients were investors who were flipping houses.
"Once they got them fixed up and rented, they'd refinance them, and that was the next house that they bought," Miller said.
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But in 2008, circumstances changed. Gas prices went up, so the one-hour commute to the Twin Cities got more expensive for Miller and his neighbors. Houses stopped selling in the Twin Cities, which meant their remodeling work dropped off.
Miller and his wife, Kim MiLee, started falling behind on their own house payments. The Millers had applied for a loan modification through the federal Making Home Affordable Program, but after nine months of haggling, their application was denied. Last December, the family made a choice to celebrate Christmas rather than to make a mortgage payment.
Their house was sold at a sheriff's auction in July. Under Minnesota law they can stay there for six months, but they'll be evicted in January if they can't pay the $225,000 they owe. Banks have foreclosed on at least 14 other houses on their block.
The Millers have thought hard about what is happening to them and, literally, half of their neighbors.
"It's a pathogen, a cancer," Miller said, "not one [of us are] losers who bought a $400,000 house with a Burger King job."
'WE CAN'T RIGHT ALL THE WRONGS'
Many Isanti County homeowners were working people reaching for a middle-class lifestyle. The catchphrase was "drive to afford," because you could get a bigger house and more land if you were willing to drive a little farther away from the metro area.
Almost 20 percent of the men in Isanti County worked in construction, according to the Minnesota Department of Employment and Economic Development, or DEED. Many of them were self-employed tradespeople like Miller, who were leaving urban neighborhoods for a suburban lifestyle.
Builders, developers, and bankers were happy to accommodate, offering mortgages that required little or no money down and low interest rates to start.
"There were so many enticements to get people to move into these homes," said Susan Morris, the president of the Isanti County Board of Commissioners. Now that the housing bubble has burst, she worries about the stability of the county.
"There's not enough money in our local economy to help make all these wrongs right," she said.
DEED says the ratio of jobseekers to jobs available in Isanti County is 20 to 1, the highest in the state. The jobs that are available locally are mostly retail.
At Community Pride Bank just south of Cambridge, president Greg Owens sees when customers fall behind on their payments. These days they rarely catch up.
Owens worries for the families, and he worries for the bank. When the state cut local government aid for the third year in a row, it helped send the region into a tailspin.
"The cities and counties and school districts are in absolute crisis right now," Owens said.
PEOPLE ARE NEW TO POVERTY
And as local jurisdictions wrestle with cuts, demand for services soars. In Isanti County, nearly 3,000 people receive cash assistance, and thousands more qualify for food stamps or need help collecting child support. Police departments, food shelves and homeless shelters are busier than last year.
"We've had a lot of middle class families new to poverty," said Mary Westlund, program manager for New Pathways, a church-supported homeless shelter in Cambridge.
"Being new to poverty is very confusing. They don't know how to use food support, they don't know about the cash grant system or where to go for help," said Westlund.
The Millers went to the county for help last winter when they ran out of work -- and money for groceries. They qualified for food stamps, medical assistance and cash to tide them over.
Miller was applying for jobs at technical colleges as an adjunct plumbing instructor. By summer, Kim MiLee had found a temporary part-time job as an advocate for victims of domestic abuse. But they couldn't pay their bills on what she was making, less than $400 a week.
"What angers me the most is I have a B.A., a four-year degree, and he has a master's trade license, and we can't find jobs," MiLee said. "I never saw this coming."
Miller has been attending "Grassroots Roundtable" meetings at Community Pride Bank just south of Cambridge. The meetings are attended by about 20 people -- foreclosure counselors, elected officials, nonprofit service providers and local businesspeople -- who try to brainstorm their way out of the crisis.
At the very least, it's a support group for a community under siege. At the August meeting, Miller warned homeowners in financial trouble not to fall for predatory schemes like he did.
"As soon as our house notice went in the paper," Miller said, "we were flooded with sympathetic letters."
Miller told the group those letters came from law firms who said they could help lower payments, and companies that promised to fix his credit score. He paid a credit-lowering company $45 a month for three months, and then figured out he was getting nothing for his money.
AN OMINOUS FUTURE?
"Don't pay for help," said Ed Nelson, communications director for the Minnesota Home Ownership Center. He told people at the meeting that free financial counseling is available through his office.
"No matter how dire the situation, a homeowner always has decisions to make, and financial advice is important," Nelson said. And there are more dire decisions to come.
"This is the most brutal information I've ever had the misfortune to come here and present on," Dan Williams said at the meeting.
Williams is a foreclosure counselor with Lutheran Social Services, the state-designated foreclosure assistance provider for Isanti County. He held up a chart from the Minnesota Housing Finance Agency that shows parts of Isanti and neighboring counties among Minnesota's hardest hit.
Greg Owens, who convenes the meetings at his bank, said the future is ominous.
"For many city administrators, there is a huge question whether or not they'll even be viable in the next seven to 12 years," he said. "They could go bankrupt. We have not seen that in our state in the past."
Shawn Miller has had another reason for coming to the meetings at the bank. He's climbing the walls at home. He was there all summer with his two children -- Inez, who is 16, and Conner, 9 -- fruitlessly looking for work, with no money for diversions.
GOING WEST, HOPING FOR A NEW START
Kim and Shawn have watched their neighborhood empty. They don't know where their neighbors have gone. Shawn had an offer to teach at Anoka Hennepin Technical College this fall, but the class was canceled due to low enrollment.
Kim MiLee says the kids have been in on all the decisions. It's important to her that they know what's happening is not their fault.
"We like to talk to them about it so they're not scared," she said. "We talk about how our life is going to change, instead of that we don't have any money."
The family recently decided to give up on Minnesota. They're selling everything they can, and next week they will get in their car and head to New Mexico.
They think the drive will be fun, and they know heating costs will be lower. They have no prospects, just hopes -- for a job and a place to live.
Read the second part of this series, which explores how needy residents in Isanti County are receiving help.