The Latest Celebrity Foreclosure: Ed McMahon

The mortgage crisis is so bad, it's now claiming celebrities as victims: Evander Holyfield's $10 million home in Fayette County, Georgia; Jose Canseco's home in Encino, California; and Ed McMahon's $4.8 million home in Beverly Hills, California are being foreclosed.

One guy that averted foreclosure was Michael Jackson: his Neverland Ranch auction was cancelled when an investment company bought the loan.

Ed McMahon even went on Larry King's show to explain how he got into financial hot water:

King: And the payments, you can't make -- what's the problem?

Ed McMahon: Well, if you spend more money than you make, you know what happens. And it can happen. You know, a couple of divorces thrown in, a few things like that. And, you know, things happen. You want everything to be perfect, but that combination of the economy, I have a little injury, I have a situation. And it all came together. [...]

King: But, Pam, the assumption is that the McMahons are multimillionaires and multimillionaires -- how much behind are you, $644,000, right? That's what's reported? ... If you're a millionaire, shouldn't you be able to pay $644,000?

Pam McMahon: I think over the years, you know, it's just a kind of a combination of maybe Ed working so hard and not kind of looking at proper management, which happens a lot. ... Because you're a celebrity, people think you have a lot more than you have. And you always want to take great care of all of your friends and your family and everybody, and you do. And you don't, and I think, you know, we didn't keep our eye on the ball. We made mistakes.

Transcript of Ed and Pam McMahon's interview with Larry King: Link

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Ugh... only spend money you actually have, Ed.

In response to a few of the posts here, I'm sorry, but no one's selling "bad loans."

If a loan company says you haev a flexible rate, and you sign it, YOU are responsible for paying that. Considering the government is forcing loan companies to go aginst the contracts, a TON of them are going belly-up. Why? They counted on the money that would come from those loans, otherwise they wouldn't have been able to make the ultra-low rate promises to people. If you sign something, you should be bound to it. It's not the insurer's fault you don't want to pay what you agreed to.
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They didn't have less money than I think they did. They just spent more money than they should have. No none needs a 4.8 million dollar house. Unless it is meant to house a family of 50 or more.

If I thought he was going to end up living in a '78 Ford and eating at soup kitchens I would be able to feel sorry for him. He will come out the other end of this living in far greater luxury than most of us can dream of. Without having learned a thing, most likely.
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Fixed Rate would have prevented this.

NEVER get a loan with a flexible (aka adjustable) payment plan or a balloon payment at the end. When interest goes up, your payment goes way up.

Always ask for FIXED RATE for the term of the loan.
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Yep, real hard to have sympathy for a man who has made millions of dollars, and is now apparently broke.

I have never had a lot of money, and I have always said that if I ever do have a lot of money that I would invest it wisely and build businesses to make even more money so that I would never have to worry about not having enough ever again!

Guess my old one line joke on the way out the door (If Ed McMahon knocks on the door while I am gone, tell him I will be right back!) is no longer valid!

Damn! I feel like a true American Icon has just really let me down! Say it ain't so, Mr. McMahon!
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