SW Florida Banks In Danger Of Being Stiffed On $57.5 Million In Construction Loans

In Southwest Florida, The News-Press reports:

• "Area banks are racking up millions of dollars in bad debt, thanks to the softening real estate market in Southwest Florida. Five Southwest Florida banks had a combined $57.5 million in outstanding construction and land loans that weren't being paid, according to records from the Federal Deposit Insurance Corp. for the first quarter of 2007."

Included in the article is the story of a retired couple who bought four properties — two in Lehigh Acres and two in Cape Coral — when the market was hot and now find themselves in a financial quagmire. Three of the homes were bought from First Home Builders (go here for more on First Home Builders and others).

For more, see Bad loans saddle area banks (Housing bust fuels 207 percent rise).