Mortgage Mess Hits Home For Nation’s Small Builders
In the first wave of the housing crisis, homeowners across the U.S. lost their properties to foreclosure. Now, many of the nation’s small and midsize home builders are on the ropes.
Bill Whitlatch, longtime owner of one of the leading home builders here in northeast Ohio, is among the casualties. Three years ago, he borrowed from regional banks to start six developments in the Cleveland area. Soon the region’s home market turned cold. Buyers vanished. Mr. Whitlatch drained his personal savings of $2 million to keep his company going.
It wasn’t enough. In September, the company filed for bankruptcy protection. Now owing about $1 million to dozens of subcontractors, and $8 million in debt to his banks, Mr. Whitlatch is selling the family home he designed.
“I couldn’t come up with any more money, and I couldn’t generate any more sales,” says Mr. Whitlatch, a tall, 68-year-old grandfather who says he had planned on selling his company and retiring.