10 Celebrities Flirting with Foreclosure
As the housing market continues to deliver news of doom and gloom, it is apparent that no one is safe from falling behind on mortgage payments and possibly slipping into foreclosure, including the sports stars and movie stars we follow. We’ve compiled a list of celebrity homeowners, that varies from A-listers and retired athletes to reality TV stars, who have all danced with foreclosure over the past year.
While Charlie Sheen is currently raiding the airwaves with shocking comments and tales of his outrageous lifestyle, last year’s celeb making news for all the wrong reasons was Mel Gibson. Amidst his ongoing legal and custody battles, his real estate portfolio has taken quite a hit. First up was Gibson’s 75-acre Greenwich, CT estate, which first hit the market in 2007 for $39.5 million, took a price cut to $35 million a few months later, then finally sold in July 2010 for $24 million – 40 percent less than the initial asking price. Next is Gibson’s Lavender Hill Farm property (pictured above) located in Malibu, CA. Gibson listed the four-building estate in March 2010 for $14.5 million. A year later, it is still on the market with a reduced asking price of $12.75 million.
Gibson’s four properties in Malibu, including Lavender Hill Farm, two additional residential properties and a church, are unfortunately facing a worse fate than selling for a loss. In September 2010, TMZ reported that Rampage Construction, the company contracted to work on the actor’s Malibu real estate investments, filed a lawsuit against Gibson and former wife, Robyn, for failing to settle an outstanding $12,000 bill. Rampage Construction filed another lawsuit against A.P. Reilly Foundation (the company that owns Gibson’s church) to pay up on an outstanding $200,000 invoice. Both lawsuits demand payment or placing the properties in foreclosure.
Former NBA All-Star-turned-Turkish basketball player Allen Iverson quit paying his mortgage and let his 6-bedroom, 6-bathroom home in Cherry Hills, CO slip into foreclosure. According to the Denver Post, Iverson’s Cherry Hills mansion (pictured above) had an outstanding balance of $2,572,914 owed to Wells Fargo Bank. Luckily a buyer was found for the 10,445-sq ft home and a sale is expected in early April with a final sale price close to the current asking price of $2.85 million. However, despite finding a buyer, Iverson is still responsible for attorney fees, foreclosure costs, and default interest.
Jermaine Jackson, older brother of deceased superstar Michael Jackson, isn’t losing a home he owns to foreclosure, but did lose the Calabasas home he rents to foreclosure. Jackson’s former residence was scheduled to be auctioned on the steps of the Pomona, CA courthouse at the beginning of the year with the minimum bid allowed $2,184,233. The former Jackson 5 member leased the home for just under 18 months and, according to California law, had 60 days from the time of foreclosure to vacate the premises. Perhaps Jackson was able to shack up at his mom’s recent $26,000/month rental just a few blocks away. The move could be a blessing in disguise, though. The Calabasas real estate market has seen decreasing values on 83.5 percent of homes in the area.
The 5-bedroom, 6-bathroom home wasn’t exactly a good luck charm for Jackson. In addition to foreclosure, he fell victim to a burglary in September 2010 reporting that jewelry, furs, and clothes worth nearly $150,000 were stolen from the house.
As Zillow previously reported, Real Housewives of OC Alexis Bellino and her husband, Jim, were walking the foreclosure tightrope for quite some time, first working out a loan modification on their Newport Beach home (pictured above), and then rescheduling a January 2011 foreclosure auction to February. With their home simultaneously on the market at a heavily reduced price of $3,995,000 (down from an original $7,999,000), the Bellino’s were able to completely dodge foreclosure. According to The Orange County Register, “the [Bellino's] lender, JP Morgan Chase, is no longer pursuing repossession of the property.” Public records show the 6,400-sq ft, 6-bedroom home sold for $3,000,000 this month. That’s 62.5 percent less than the reality TV couple’s original asking price. Nearly 22.9 percent of homes in the Newport Beach real estate market have seen price cuts; Zillow Real Estate Market Reports show the median price cut is around 7 percent.
The home of the late actress, Brittany Murphy, was on the path to foreclosure but, thanks to some interested buyers, it averted the scheduled auction. Public records show Murphy and her mother purchased the 8,000-sq ft house for $3.85 million from pop star Britney Spears in June 2003. Following the sudden death of Murphy in December 2009, the Hollywood Hills home was listed for $7.25 million in March of 2010 but was promptly removed just a month later. Last month, Murphy’s former home (pictured above) was scheduled to be auctioned off but received a two-week postponement, giving Brittany’s mother, Sharon Murphy, a chance to sell the property at the steeply reduced price of $4,995,000. According to a statement given on Sharon Murphy’s behalf, “the trustee sale has been postponed and the seller is currently in negotiation with several parties regarding potential sale.” Murphy’s mother is on par in slashing the price of the home to make a sale. Over 25 percent of home in the Hollywood Hills real estate market received a price cut in the last 30 days. Murphy’s Hollywood Hills home is still on the market, sitting with a reported first mortgage and second mortgage totaling close to $4.5 million.
While former Oakland Raiders quarterback JaMarcus Russell was making plays on the football field, he decided to stay on the sidelines when it came to making payments on his million-dollar mansion in Oakland, CA (pictured above). According to TMZ, Russell “allegedly failed to pay $195,512.05 in mortgage payments.” Oddly enough, Russell signed a contract in 2007 worth nearly $60 million. Despite the eight-figure deal and trying to settle his Oakland real estate mess, Russell is still looking for a new job. He was released from the Raiders in May 2010 and is currently a free agent.
Patricia Kluge, Albemarle House
Perhaps the most shocking foreclosure on the list is that of the elegant, 45-room mansion known as the Albemarle House. The rare piece of Charlottesville real estate was most recently owned by billionaire winemaker Patricia Kluge who first attempted to sell the property for $100 million in 2009. It was later reduced to $48 million in early 2010, and then to $24 million in November 2010. Just last month, however, Bank of America beat out Donald Trump at a foreclosure auction with a winning bid of $15.3 million. Apparently, Bank of America held a property lien on the estate worth close to $23 million, which may have given them some leverage during the bidding war.
The Albemarle House was built in 1985 and boast 300 acres, 23,500 sq ft, 8 bedrooms, 14 bathrooms, a library, art gallery, home theater, helipad, tiered garden, pool, staff quarters, wine cellar, and horse stables.
See more photos of Kluge’s Albemarle House
Retired NHL star and three-time Stanley Cup winner, Sergei Fedorov, had to say goodbye to two of his Detroit real estate investments. Just 20 miles northwest of Detroit, Fedorov owned two homes in the affluent city of Bloomfield Hills. Last year, however, Zillow reported that the Russian hockey player was facing foreclosure on both homes, one in which he owed $1.2 million and the other around $915,000.
Fedorov’s Michigan properties hit the market within the last few months, both with significantly reduced prices. Fedorov’s Huntington Lane property is presently listed for $999,900 — a 20 percent decrease from his $1.25 million purchase price. The 1-acre, gated estate features a 4,400-sq ft home with 4 bedrooms and 5 bathrooms. His Tiverton Road property (pictured above) first hit the market in September 2010 with an asking price of $1,499,000. Now listed for a flat $1,000,000, the Tudor-style home boasts a 5,290-sq ft feet with 6 bedrooms, and 6.5 bathrooms, an indoor pool, vaulted master suite, and a tennis court all included behind a gated 2.3-acre lot.
Timbaland (Timothy Mosley)
Infamous beat builder and rapper, Timbaland, found himself flirting with foreclosure, but not because he was short on the cash. According to a report from the Detroit News, Timbaland failed to pay $27,000 in condo assessment fees on his $2.6 million South Beach condo. The condo association at his building, Murano Grande at Portofino (pictured above), first filed the original assessment of $18,883 in August 2010. But after two months without payment, the lien on the producer’s pad increased to $27,118. At this point, the condo association filed to foreclose the property in order to collect the outstanding balance. Luckily, Timbaland contacted his financial team and made the payment immediately, sidestepping the loss of his multi-million dollar condo. Missing the payment was simply a “clerical error.” In addition to his high-rise piece of Miami Beach real estate, Timbaland also owns a 10,700-sq ft home in Pinecrest, FL that he purchased for $3,475,000 in July 2004.
Former NBA star Antoine Walker hit a wall of debt after his 13-year career of pro basketball. Last year, Crain’s reported that Walker had liabilities of $12.74 million vs. $4.28 million in assets, not to mention the prospect of going to prison for non-payment of $1 million in gambling debt and his involvement in investment companies accused of slum housing in Chicago’s South Side. With jail time and bankruptcy on his mind, foreclosure may have been the least of his worries. At the time of the initial report, Walker’s Tinley Park home was three months behind on payments with a debt to the bank totaling $2.28 million. His stake in Miami real estate was also on the chopping block and is listed for $3.4 million. Just a few weeks ago, the price of Walker’s Miami home was almost chopped in half and is now listed for a please-buy-me price of $1,995,000. The 7,000-sq ft house is located in the heart of Coconut Grove and features 5 bedrooms, 5 bathrooms, maid’s quarters, lap pool, zen garden, and two separate gated entrances.
See more photos of Walker’s Miami home
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