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I made a similar mistake when I bought my present home. I bought in late 2007, and prices had already fallen about 45% from the peak 16 months earlier. Darn near half is a pretty substantial drop, and I reasoned that we had to be near bottom. I was so wrong. Prices fell about that much again after I bought.
You know, it's one thing to owe 700k on a home worth 850k. It's quite another to owe 700k on a home worth 250k. Yet, that is the position many people around here found themselves in. Some looked at the facts and decided their best path forward was to strategically default. Note that a strategic default does not recover the money you have already put into your home. Far from being the path to riches, it was for some the most sensible course of action.
You know, it's one thing to owe 700k on a home worth 850k. It's quite another to owe 700k on a home worth 250k. Yet, that is the position many people around here put themselves in. Some looked at the facts and decided their best path forward was to strategically default. Note that a strategic default does not recover the money you have already put into your home. Far from being the path to riches, it was for some the most sensible course of action.
I fixed that for you.
Whether or not a strategic default makes more sense probably depends whether you're in a recourse state or can get the lender to agree to not pursue the deficiency in a short sale deal. Defaulting on a $700k loan that sells for $200k after selling expenses and still owing $500k doesn't help you much.
When will people learn that they must pay what they owe. If you signed a contract with an agreement to pay then you owe that amount. I am against this whole shrugging your shoulders and walking off from your debts. Make the people pay...whenever and whatever they can.
Since 2010, the second-largest U.S. bank has agreed to pay at least $70 billion to resolve disputes linked to home loans, mortgage bonds and other problems stemming from before and during the crisis. In the most recent settlement, the bank paid $16.65 billion to resolve Department of Justice charges that it misled investors in its mortgage bonds.
yep - yep -the decline in our economy are these poor folks doings! hm hm -- some who lost money in the investment world-want punish them all- no phones -no tv -no happiness, no anything-- after all it is all your over reaching that made this mess.
why are the banks paying out if it was the poor-man's fault? pay the piper Mr Banker.. you played that tune. (Make the people pay)-- no put some bankers in JAIL
The banks were forced by govt to lend to people who they knew couldnt pay . Every tom, dick, and mohammed had a right to own a home........................lol.
HAHAHAHA-- too funny- I worked for the banks they begged to stop the regulations and it was a deal by both parties- and I quit doing 2nd mtg loans because of the fraud. Since when has anyonee ever forced a bank to do anything HAHAHAHA
Hopefully in the future we can just construct new jails in which to put these dead beats. These freeloaders can then pay off their debts by the penny by creating license plates, tennis balls, and bricks for hard working Americans.
I find it perplexing when people suggest buyers should have known prices were "too high". If lenders did not know, home builders did not know, realtors did not know, and appraisers did not know, how exactly is it that buyers should have known? Do you honestly believe buyers knew that the home they were buying today for 850k would be worth 250k in a few short years? Of course they did not know.
Quote:
Originally Posted by Malloric
Whether or not a strategic default makes more sense probably depends whether you're in a recourse state or can get the lender to agree to not pursue the deficiency in a short sale deal. Defaulting on a $700k loan that sells for $200k after selling expenses and still owing $500k doesn't help you much.
I find it perplexing when people suggest buyers should have known prices were "too high". If lenders did not know, home builders did not know, realtors did not know, and appraisers did not know, how exactly is it that buyers should have known? Do you honestly believe buyers knew that the home they were buying today for 850k would be worth 250k in a few short years? Of course they did not know.
Certainly.
I knew. when I looked at buying a house due to easy access to credit, I looked at the house valuation to income ratios for the last few decades, and decided against it. Instead I bought in 2011 paying 60% for my house compared to what ti sold for in 2008 or so....
I knew. when I looked at buying a house due to easy access to credit, I looked at the house valuation to income ratios for the last few decades, and decided against it. Instead I bought in 2011 paying 60% for my house compared to what ti sold for in 2008 or so....
most of the people who bought overvalued properties.. it was their own damn fault. They seriously overpaid for the property because they wanted the house at the time regardless of the consequences. Would you buy a Toyota Corolla tomorrow if it is selling for $100,000? Of course not. During the bubble homes were selling for prices that were absolutely asinine...nobody even stopped to ask questions, if they got the financing they just went for it.
They speculated and gambled and then lost. If you are in a state that has the deficiency judgement then you should've known there is a possibility you could owe thousands upon thousands in deficiencies. So should we feel sorry for these stupid fools? Of course not!
I did not buy a house then and am not buying now in Southern California because I know the prices are in fantasy land. But some people still vehemently justify the prices.. when you tell them it could crash they say never and laugh at you and then when it all collapses they keep crying about how they are the victims.
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-- some who lost money in the investment world-want punish them all- no phones -no tv -no happiness, no anything-- after all it is all your over reaching that made this mess. 
