'Kitchen Table Series': One Family Fights Foreclosure

Jan. 29, 2008— -- Three years ago, at the peak of the housing boom that's now gone bust, Susan and Michael Walker bought their piece of the American dream in Clayton, N.C., for $172,000, with no money down.

"I have always wanted a nice home in a nice neighborhood for my family. But the price that has come with it? Who would have imagined," Susan Walker, 43, said.

Her husband Mike, a house painter, and Susan, who works in a doctor's office, have a combined income of around $80,000 a year -- enough to managed their mortgage payments at the introductory rate of 9 percent.

"And then it just kept going up and up…" Mike said.

The rate has adjusted every six months until it crept to where it is today at 14 percent.

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The Walkers' monthly payments on the house have risen to $2,015 a month. It's a struggle coming up with that and paying the rest of their bills too. Often they make choices about which to pay and which to let go.

The phone's been turned off; Mike's truck has been repossessed. They fill up $10 at a time.

"I can't even afford to get gas so I can go to work, make money, pay the bills," he said.

The Walkers are so afraid of losing their home and uprooting their three sons that they pay the mortgage first even when it cuts into grocery money.

"We had the electric company come in here to shut off our electricity," Susan cried. "It's so embarrassing."

There are times they've borrowed from their sons to pay the bills.

Brian, 19, said, "Sometimes my mom can't pay 'em and she'll ask me or Alex if we can lend her some money. She comes home stressed a lot."

Mike has been looking for a night job. But for all they struggle, they have still fallen two months behind on their mortgage payments.

Susan said their worst fear is that they lose their house and end up homeless.

"I just don't know. I mean, we have three kids who live here with us and this is their home. I don't know," she said.

The Walkers say they've tried to do all the things the experts say they should. Mike says he mailed an application for a loan workout to their lender, Homecomings Financial, weeks ago, and he's called them hundreds of times to try to negotiate a more affordable rate.

"I can't do it anymore. The percentage is just too high for us. And the payments are [high, too.]"