Neighborhood Hit By Mortgage Crisis Battles Back

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Windy Ridge mortgage crisis

CHARLOTTE, North Carolina  — There’s only one way in to Windy Ridge — across freight train tracks that zipper up the subdivision on three sides. Living room windows offer views of a cardboard box factory and a Pepsi bottling plant. It’s an unlikely place to come looking for the American Dream.

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But to appreciate Wigena Tirado’s bond with this neighborhood of 133 vinyl-sided starter homes planted on a mostly treeless slope, listen to how she got there.

Tirado, a divorced mother of four with a degree in social work, moved to North Carolina in 2003 searching for a job and counting on a Section 8 low-income housing voucher to cover most of her rent. She moved out of her first home after finding a bullet hole in the front door. She fled the next rental, too, after it was burglarized at 2:30 on a weekday afternoon.

By then, Tirado was teaching at a daycare center. She jumped at one mother’s suggestion that she rent the house across from her own.

The three-bedroom house, white with blue shutters, sat on a new street with lots awaiting construction. Tirado liked her neighbors. Her biggest doubt was raised by cards that arrived in the mailbox offering help in battling foreclosure.

Tirado’s landlord told her not to worry. But in early 2007, a Mecklenburg County sheriff’s deputy rang the doorbell.

“What did you do?” Tirado quizzed her son, John, then 13. The problem, though, was Tirado’s house. The owner was in foreclosure and the family had to be out by April.

“I will not be moved from here,” Tirado told the bank, offering to buy the place. She had no idea what she was getting into.

Four years later, the nation is finally coming to terms with the gambles and gross errors that pushed the economy, and neighborhoods like Tirado’s, over a cliff.

But how do you go about reversing the damage the mortgage disaster has done to families and neighborhoods? Where do you even start? On that afternoon, Tirado’s questions went only as far as how to stay put in the house at 4625 Palm Breeze Lane.

And so the battle for Windy Ridge began.

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Windy Ridge is a small petri dish in a much larger experiment. Across the country, officials and non-profits are trying to stabilize neighborhoods pummeled by foreclosures — most visibly by buying vacant houses with nearly $7 billion approved by Congress.

In Charlotte, where Windy Ridge followed a nearby subdivision, Peachtree Hills, as the first to undergo triage, it’s too soon to know how such efforts will work long-term. But it is already a story worth examining for lessons.

In 2000, a developer bought 38 acres in northwest Charlotte and laid out a subdivision shaped like a saxophone. Nearly all the lots were purchased by a local company, Barber Builders.

Barber built houses — all single-story and sold at a top price of $109,000 — for families with modest paychecks. But a review of county property records and interviews with buyers and residents show Windy Ridge was marketed to investors as an opportunity for steady rental income, with many purchasing multiple homes in quick succession.

Luther Rankin, a former city street maintenance worker who has lived in the subdivision since 2003, recalls being mildly surprised by the age of the property owner who arrived in a new BMW to show him a rental. Only later did Rankin realize his landlord owned four others.

“Who gives that kind of money out to at most a 30-year-old unless your daddy is Donald Trump?” Rankin says.

“Volume was good, so if somebody wanted to buy more than one house we were more than willing to sell it to them,” says W. Freeman Barber Jr., who sold the building company about 6 years ago. “Of course, we had no idea of the implications.”

Barber said he offered volume discounts to investors who bought multiple homes, but delegated marketing to real estate agents working on commission.

Many investors signed up tenants with federal Section 8 vouchers, given to low-income families to cover rent in the private market. Keith Wesolowski, who bought five houses, said a sales agent presented the subdivision as “newly constructed houses you can use as rental properties and here’s Section 8. Here you go.”

Early arrivals recall a neighborhood full of potential. Chris Youmans, who moved in with his wife in 2004 with a rent-to-own deal, said he was encouraged to see other black, working-class families in nearby houses. Joana Madruga, an Atlanta investor who bought four houses, recalls the homes and newly seeded lawns as beautifully kept.

It didn’t last.

Months after Madruga took title, somebody broke in and ransacked three of her houses. The Youmanses’ landlord went into foreclosure and the couple lost roughly $5,000 of rent that was supposed to give them an equity stake. They moved to a second house down the street, determined to make a go of it.

By the time Tirado moved in, more investors had stopped making loan payments. But it wasn’t until her house went into foreclosure that Tirado made a connection between chronic problems — streetlights gone dark because of unpaid homeowners’ fees, frequent break-ins, yards littered with trash — and the mortgages to absentee landlords that were the neighborhood’s foundation.

The bank wouldn’t sell to Tirado because of a weak credit record. But she stayed when a new investor bought the property.

She went to Homeowners’ Association meetings, though she didn’t own. She called police repeatedly to report the sound of break-ins, though the lack of streetlights made it difficult to know which house the thumps were coming from. In 2007, police investigated 38 break-ins in Windy Ridge, with 32 more in 2008.

“All of Morning Breeze looks like a war zone,” Tirado e-mailed the homeowners board in 2008, with a house-by-house breakdown of grass that needed cutting and trash piling up.

Charlotte police asked Tirado to head up a neighborhood crime watch. Allies like Fausto Alfaro, a guard at the Mecklenburg County Jail whose family bought the house across the street, stepped up calls to police and e-mailed prosecutors when those arrested for break-ins in the neighborhood went on trial.

When Officer Brent Hartley drove through the subdivision, Tirado waved him down at curbside. The police were paying more attention, she knew. Still, sometimes she felt like an army of one.


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In late 2007, staffers in Charlotte’s department of neighborhood development, studying data on local foreclosures, focused their attention on fast-decaying new subdivisions.

“To get out in suburbia and to start seeing the same kinds of things you normally see in an inner city neighborhood, it was something that was totally unexpected,” says Stanley Watkins, then the department’s director.

The highest concentration was in two new subdivisions on the city’s northwest side: Windy Ridge and Peachtree Hills, a neighborhood of mostly two-story homes with similar problems.

City officials were working on an action plan when Watkins got a call from Evan Covington-Chavez of the Center for Community Self-Help, a non-profit lender based in Raleigh, N.C., looking for a neighborhood where it might turn the foreclosure tide.

They settled on Peachtree Hills. The city finished sidewalks, stepped up policing and building code enforcement and worked with residents to build a viable homeowners’ association. Its most visible triumph came last summer when, thanks to a private grant and 300 volunteers, the neighborhood erected a new playground.

Self-Help tried turning renting families into owners. But banks ignored their calls, letting homes go to investors at auction. So the group changed plans, buying and rehabbing 30 homes and reselling to responsible owners.

On a recent afternoon, Self-Help’s Donnetta Collier leads the way through her Peachtree portfolio.The worst is a two-story with windows missing and holes punched in the drywall. But the same floor plan sparkles around the corner, where a chandelier hangs in the dining room and Collier has stocked an upstairs tub with olive oil chamomile bath soap.

“It’s a great starter house. It really is. You’ve just got to find the right people,” Collier says.

But Self-Help, which expected a commitment of a few years, now expects a turnaround to take longer. Attendance at homeowners meetings has dropped off. And home prices are falling.

“The goal is to stabilize the neighborhood,” Covington-Chavez said. “We started that happening and it felt really good to see we were able to make a difference, but then the second wave of foreclosures came in and sort of knocked us back down to reality.”

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In Windy Ridge, Wigena Tirado and her neighbors were at last getting some allies.

Early in 2009, city officials asked the local chapter of Habitat for Humanity to take a role in the battered subdivision. Habitat, drawing primarily on federal money, bought 10 houses and so far has matched families with seven. But, just as Self-Help found in Peachtree, relying on grants with restrictions left it unable to keep pace with investors.

To prevent such scenarios, the federal government reached an agreement with mortgage lenders last September to give neighborhood stabilization grantees a first look at foreclosures before investors can buy them.

“In retrospect, maybe we should’ve borrowed some money to make it happen quicker,” says Bert Green, Habitat’s executive director.

Meanwhile, the city cracked down on landlords who were not caring for houses. City crews shored up some backyards, trying to combat erosion. Tirado’s Crime Watch, feeding information to police, paid dividends. Break-ins dropped from 32 in 2008 to 6 in 2009 after the arrest of three men, one from the neighborhood.

The subdivision drew the attention of Janni Sorensen, a University of North Carolina at Charlotte professor who had spent years organizing residents in poor, but much older, neighborhoods in East St. Louis, Ill.

Windy Ridge is a “neighborhood built to fail,” says Sorensen, pointing to factors ranging from its site between railroad tracks and lack of communal space to the concentration of absentee landlords and poor renters.

With a grant from the city, she hired a graduate student, Liz Shockey, to organize residents and assigned other students to do fieldwork in the subdivision.

Shockey worked to build the homeowners’ association and with Alfaro as president, Windy Ridge replaced its management company. She and Tirado organized movie nights for neighborhood children, and UNCC recently brought in 140 volunteers to pick up trash.

The neighborhood still has eyesores like the house on Morning Breeze with plywood masking its windows. But the number of vacant homes has declined, to 22 in the most recent survey by UNCC students. Sorensen is intent on finding money to buy one of the empty houses and turn the site into a playground.

Still, the neighborhood’s diehards run up against what Shockey calls “Windy Ridge burnout.” The Alfaros have their house on the market. Last year, the Youmanses found a house they could buy, but in another neighborhood. Then, in September, Tirado moved out, fearing her landlord was headed for foreclosure.

Months before, city officials named Windy Ridge the city’s “most engaged” neighborhood. But tax notices this spring confronted owners with figures showing their homes are valued at little more than half their original prices. Break-ins quadrupled to 27 last year.

“I’m not going to lie to you,” Alfaro says. “Sometimes I know I made a mistake.”

But then he points out the new shrubs at three nearby homes bought by Habitat. Two doors up, Andre Knight, a cook at a sports bar, recounts how he visited every afternoon to water the fresh sod while Habitat’s crews brought the house back to life. He picked out the teal paint for the master bedroom and chose the carpeting.

“The lord says you ask for what you want, to picture it in your mind and you design your own ideas,” Knight says. “That’s why I knew this house was meant for me.”

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Does the American Dream still have a prayer in Windy Ridge?

For the subdivision to succeed will take more than one homeowner or one house. Nobody understands that better than Tirado. She still calls Palm Breeze “my street” and shouts greetings to the neighbors. A few weeks ago, she signed on as the subdivision’s first-ever property inspector, paid for mileage.

In her new apartment, Tirado leaves the shades open and the light floods in. There’s a swimming pool and a racquetball court. But the battle for Windy Ridge keeps drawing her back.

“Over here it’s nice,” she says, “but it’s not a family.”

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