You may remember Dustin Diamond as “Screech” from the television show, Saved By The Bell. I heard about his situation a few days ago. He appeared on Howard Stern’s satellite radio show and begged his fans to buy his tee-shirts so he could pay off his house, as he has run into sorry financial times.
I have a real problem with celebrities asking for money from their fans. He purchased a $500,000 house in Wisconsin, and he should be responsible and move out if he can’t handle the payments.
Apparently this is not the whole story. His parents mismanaged his earnings when he was a child actor and allegedly stole money from him. With Dustin’s bad credit, he wouldn’t qualify for a tranditional mortgage “quick enough,” so he decided to enter a “land contract.” Here’s his side of the story.
The owner of the contract supposedly wants the house back and has called the loan. Now Dustin has two weeks left to come up with $250,000. I do feel a little sorry for him, but it sounds like he jumped the gun and purchased a house before he was ready.
So what is a “land contract?” I didn’t know until I looked it up.
A land contract, which is more common in the mid-west, involves a seller who finances his property to the buyer. The buyer can place a smaller down payment than a bank would require, and then makes regular payments. The seller remains the legal owner of the property while the buyer owns the equity and qualifies for the tax benefits one would find in a regular mortgage.
In some cases, and apparently in Dustin’s case, the seller can foreclose out the buyer quicker than a bank can foreclose a typical mortgage.
Dustin is hoping there are thousands of Screech fans out there, ready to buy tee-shirts and pay off his contract in the next two weeks.
Updated December 20, 2011 and originally published June 22, 2006. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.