Anybody Underwater on their Mortgage (Jefferson: real estate, good credit, loan)

[mrdkb]

I don't think the gov plan will do much to help those who had a decent downpayment, good job, good credit rating - but are now underwater.

[dman72]

Yep. We put down 15K 2 years ago or so, got a 20% piggyback, our mortgage is affordable but is probably worth at least 30K less than we paid for it now, even having upgraded some things, and even though we've paid down principle...we're still underwater

It sucks, but..it is what it is.

[JT1965]

It does suck but we have to deal with it. Remember there are 260 million people who are consumers in this country who hopefully will spend their cash here. We might be down but definitely not out.

[LocalX]

Originally Posted by mrdkb

I don't think the gov plan will do much to help those who had a decent downpayment, good job, good credit rating - but are now underwater.

I dont think that was the plan, it stinks just the same.

[TomMoser]

I am not currently underwater with my mortgage, but I was shortly after I bought it in 1989. In the early 90's there was also a severe real estate downturn. Even though I owed more then the house was worth, it did not really bother me since I was able to afford the payments and wait it out. The point is, if you can afford the payment and you're not planning to move for a few years, you shouldn't worry about it.

[Gue]

Gosh-some of the people at work.

Wanting to sell. But can't. The house is worth less than the mortgage.

So do you think when the banks become nationalized they will still allow people to default?

[Mighty__Quinn]

We're borderline right now and I'm recently unemployed. I am looking into the modification program w/ my lender.

FinancialStability.gov

[max7418]

My wife and I are probably underwater by about $20,000. It's not a big deal because we will be here for a long time, the new plan will not help us because we won't qualify for a reworked loan. I just want the market machinations to run its course and for the government to stay out of these markets. I really feel bad for the responsible people who were waiting for prices to come down alot. The Government is not interested in helping you, they are far more interested in supporting asset prices at all costs. The unintended consequences and moral hazard they are creating would truly send Thomas Jefferson rolling in his grave.

[brassbin]

Originally Posted by TomMoser

I am not currently underwater with my mortgage, but I was shortly after I bought it in 1989. In the early 90's there was also a severe real estate downturn. Even though I owed more then the house was worth, it did not really bother me since I was able to afford the payments and wait it out. The point is, if you can afford the payment and you're not planning to move for a few years, you shouldn't worry about it.

Tom, i respectfully disagree with you. This recession(or depression?) is nothing like we've seen in our lifetime, this is not a simple down turn that would recover in a few years, we have structural problem, the fundamentals of our economy will undergo drastic changes, a lot of people are going to lose their jobs, and when they do they will be instantly under water because so many people are living paycheck by paycheck.

[ClarkStreetKid]

And why are they living paycheck to paycheck? My wife and I always built an emergency fund of six months, then 12 months, then 18 months, and on and on. This was something we both learned to do while on the Island and going through a few downturns. Now we both can get laid off, pay off any bills and not become homeless. The fundamental problem with our economy was too many people living beyond their means figuring the money party would never end.

FWIW, We just bought a new car, a dishwasher and microwave/convection oven. Saving and living within our means during the good times has enabled us to take advantage of bargains now.