Celebrities aren’t immune to recession, and when bad times hit, they tend to cause celebrities to lose their giant houses, their fast cars, and their other high priced toys. When celebrities aren’t making tons of money from movies, music, sports and endorsements, taxes and payments on their luxury items tend to pile up quickly, and many celebrities find themselves in debt quite often.
In this roundup, we’ve got the low-down on the 10 biggest celebrity foreclosures, which have all occurred within the past few years.
Mel Gibson isn’t exactly having a good year in 2010. On top of all the legal problems between him and Oksana Grigorieva, Gibson is now facing a double lawsuit. According to TMZ, a company named Ramage Construction has filed two lawsuits against Gibson, claiming he owes money on three residential properties they built for him. The amount they’re asking is $12,000. In the papers, Ramage asks permission to foreclose on the three properties to settle the debt. In addition, Ramage is suing the A.P. Reilly Foundation, which owns Gibson’s “church” in Malibu, claiming they owe the company $200,000. That suit asks the same—payment or foreclosure. Between these lawsuits and the settlement Gibson will inevitably have to hand over to Grigorieva, he’d better start lining up some movies, or he’s going to be cleaned out!
Ed McMahon, who for decades appeared as Johnny Carson’s sidekick on “The Tonight Show,” fought to avoid foreclosure on his multimillion-dollar Beverly Hills home, according to published reports. The former “Star Search” host was $644,000 behind on payments on $4.8 million in mortgage loans when a unit of Countrywide Financial Corp. filed a default notice Feb. 28, 2008 with the Los Angeles County Recorder’s Office.
The Atlanta Journal-Constitution reports that the mother of Evander Holyfield’s 10-year-old son says he has missed two child-support payments. Holyfield’s reps told her not to expect the payments. Holyfield, who has 11 children total, is apparently in financial distress. His mansion in Fayette County, Georgia is under foreclosure. The home, which is worth $10 million, was auctioned by Washington Mutual Bank on July 1, 2008. Holyfield has also been sued by a consulting company for not paying back a $550,000 loan. This may explain why 45-year-old Holyfield has been trying to get back into the boxing ring for another heavyweight championship. Holyfield made significant money over the course of the years but like too many other sports figures seems to have wound up not holding on to much of it.
Music producer Scott Storch lost his $7 million Miami Beach mansion — but he isn’t homeless. Insiders say the former South Beach resident is staying at the W Hotel in Fort Lauderdale. Storch’s 10-bedroom palace was foreclosed on in 2009, and it’s reportedly been sold at auction to SunTrust Bank for $5.5 million.
Former Fugees member Wyclef Jean has failed to pay the mortgage on his unfinished Miami Beach mansion, resulting in the loss of his home. Jean took out a $2 million mortgage from Home Equity Mortgage Corp. in 2004 to purchase the estate through a corporation he owns with several friends, reports The Palm Beach Post. Although the rapper/producer set out to renovate the canal-front property, the foreclosed home, which was appraised at $1.4 million, was left unfinished for more than two years as a series of construction liens were filed. In addition, the property garnered $6,200 in fines from the city of Miami Beach once the $900,000 construction project halted after Jean and his partners couldn’t come up with the $177,913 in construction costs needed to finish the effort. Court documents note that a lien was put on the property this year by the project’s architects, who have tried to collect $75,000 owed to them since 2004. After all of that, Jean’s corporation now owes the bank $2.4 million.
Rapper/actor Xzibit is faced foreclosure on his California home after failing to hand over more than $21,000 in mortgage payments. The Hey Now hit-maker’s financial problems were revealed when documents leaked online showing he owed more than $500,000 in unpaid taxes. However Xzibit’s money woes don’t end there – according to TMZ.com, bank officials have sent him an official note warning him his Woodland Hills mansion is at risk. The website claims the hip-hop star, real name Alvin Joiner, is at least $21,403.98 in debt over mortgage back payments. Looks like Xzibit might need someone to pimp his bank account.
Jackson had an almost $25 million loan out on the house. In 2007, he was $23 million delinquent on the loan and foreclosure proceedings began. In California, after you miss three mortgage payments in a row you have 90 days to make a payment. Jackson, who hadn’t released an album since 2001, was unable to make a payment. For most people, this would have been the end of the line. For most people facing imminent foreclosure, filing bankruptcy is the best option for protecting their home. Jackson’s celebrity helped stop foreclosure. His debt was transferred to another loan company, and the property stayed with him.
Veronica Hearst, publishing heiress, Patty Hearst’s stepmother, William Randolph Heart’s daughter-in-law, and widow of the chairman of the Hearst Corporation, seems a most unlikely person to lose her house to foreclosure. Yet she had to give up Villa Venezia, her beloved 52-room, 28,000-square-foot Florida mansion. She bought it in 2000, shortly before her husband died, for $30 million dollars. She was, however, $45 million in debt, and despite scrambling to unload other assets, she was unable to pay the mortgage.
The Olympics Vancouver
In what has to be one of the more public Olympic embarrassments — second perhaps only to Canada’s not winning a single gold medal in either of the two previous Games it hosted — creditors holding $1.4 billion (U.S.) in debt on holdings of Olympic skiing venue Whistler Blackcomb’s owner Intrawest ULC have began foreclosure proceedings. The creditors planned to auction off some on Intrawest’s holdings, including Whistler Blackcomb, just days after the Olympics got under way. That’s a little like throwing a big party for VIPs and having a bill collector come knocking on your door during the festivities.