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Foreclosures

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Foreclosure is the legal process that banks use to get back some that the money they loaned once a borrower can"t repay the loan. During the 30s, there were hundreds of foreclosures. The word "foreclosure" itself ended up being a rallying cry for political movements.

Here"s what frequently happened. During the 20s, countless farmers borrowed money from banks to buy more land or brand-new machinery. Farmer pledged your assets as protection on the loan. For this reason if a farmer couldn"t do the payment on a loan for land, the financial institution could take ago the asset – the soil – and sell it to get back their money. In the 1920s, countless loans to be written as soon as land values and also crop prices were high. ~ the stock industry crash, couple of people had actually the money to buy land, and so land worths plummeted. As soon as a financial institution had to foreclose and also sell the land, they couldn"t

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make up the difference. So, banks would take all of the legacy pledged to the loan. Family members were frequently thrown off your farms and also lost everything.

Harvey Pickrel (left) had two experiences through foreclosure. His father-in-law, Merle, couldn"t pay off his loan, for this reason the bank sold his farm at auction. But Merle to be luckier than most. He maintained farming – only currently he was a renter quite than one owner that the farm. Later on in the decade, Harvey acquired behind on payment

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for a $400 tractor. In 1939, he came close to being foreclosed upon. But his banker to be willing to give him an ext time, and also Harvey had the ability to pay off the loan later.

And some farmers and also townspeople do the efforts to uncover buyers that their property so lock wouldn"t have actually a foreclosure on their record. That"s exactly how Louise Dougherty and also her husband, John, to buy their first house.

Written by bill Ganzel of the Ganzel Group. First written and also published in 2003.

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Crash!What followed the CrashWorldwide DepressionWall Street to RFDBurning Corn because that FuelCouldn"t also Buy a JobRFD to main StreetBank FailuresForeclosuresPenny AuctionsRadical farm ProtestsBarter EconomiesA brand-new DealFDRNew financial LawsWPAWPA arts ProjectsSocial SecurityThe national politics of REALocal PoliticsPolitical AttitudesMarketing in the 30sA 1930s Balance SheetParityDepression Legacy