[PATRAIN]

I'm interested in how many people out there would just walk away from their mortgage if they can't sell there home within the next year? The reason I ask is my brother-in-law is considering it after only 1 year in his home. If this becomes the trend it's going to make things extra nasty. Now, I know some people are going to get uptight thinking about this, but getting upset doesn't make it all better. I'm just trying to see if our Gov't has any clue to what is a reality out there or is all the talk of walk-aways just talk.
Now, let's throw in the kitchen sink, If you have to stay what would you give up eg..t.v., dinners out ect. to keep your house? The people I know that have walked-away in PSL decided they weren't givin up notin....

[Lilybeans]

Why would your brother in law walk away? Why?

[Wendyb0077]

life can get pretty tough and things can get pretty nasty but when you make a home purchase you sign a Note which personally obligates you to pay back the loan. This is something that you have to take very seriously. The roof over your head and keeping food on the table is # 1. Before you let your home go, do everything you can to lower your bills. I have had to do this over the last couple of years too. Cut the cable to the min. Change phone providers. Cut all the extra cell phone stuff to make your payment lower, read the paper on line, no more home delivery, Brown bag, Shop with coupons and a list, Check out Walgreens and CVS for paper products in the sale flier, Dish towels instead of paper towels, Cut your pool pump to 4 hours a day. Keep the a/c a little higher, keep lights out when not in use, wash dishes when the dishwasher is full. Combine credit card debt to the lowest interest rate card you have, try and get the lowest gas prices. Trade in your high car payment for a less expensive car/truck. The point is do what you have to do to keep your home. Don't just walk away because it is not worth what you bought it for. Your car depreciates the minute you drive off the lot, are you going to quit paying for that too... Keeping your credit score high can save your butt in bad times.

[harry chickpea]

It really is a matter of individual situations. If someone is a few thousand down, big deal. Wait it out. However, if someone is earning $50K per year and upside down on their house to the tune of $150K, and the neighborhood is decaying, then dumping it might be the best thing to do. If someone can't make a balloon rate change in interest, and knows that their job situation is tentative in this economy, then dumping might be prudent. The banks will get bailed out or restructured, some of the actual debt is owed to offshore investors who knew they were gambling, and playing patsy for an industry that made loans that never should have been allowed isn't going to help those lenders, and will just make the homeowner into yet another fall guy.

The fact is that the credit scores for some of these people are going to end up taking a huge hit anyway. Many will struggle for six months or a year and then be forced to default in total poverty and bankruptcy. It can make more sense for them to salvage what little money they might still have and run away as fast as they can. Remember the boom and bust that happened in Texas with that saving and loan scandal? Thousands of people bailed and saved themselves in that fiasco.

<rant>I cannot believe the numbers of people who were "qualified for" no-money-down home loans, and I can't believe the interest rate bumps that the lenders expected to get. This was a set-up for failure from the get-go and no agency stepped up to the plate to stop the excesses until it was far too late.

Normally I am of the opinion that everyone is responsible for themselves, but in a case where there was intent to deceive, and the masses of people affected can't reasonably expect to hold to what they bought into, then their continuing to toss money down a hole falls outside of the normal ethics of holding to a contract. Contracts are BY DEFINITION written with the understanding that both parties are acting in good faith. A contract written by weasels for short term gain at the expense of the other party has no more validity than a robber's note to a teller makes him a legitimate customer legally withdrawing money.</rant>

Do I think there are a lot of stupid and irresponsible people that got suckered in? Sure, of course. There will always be people who need the protection of laws and rules and oversight. I've seen people get suckered into multi-level marketing, ponzi schemes, and a lot of other even more blatant rip-offs. Those wanna-be homeowners and financial wizards were ripe pickings for unscrupulous agents, since the bulk of the potential buyers had every reason to trust in the whole home ownership golden apple, and were lured in even deeper by seeing big money coming out of flipping properties.

Where were the honest agents saying "You can no more afford this than a Lear Jet" or "What part of your anatomy do you think money will come out of?" The whole market was based on greed and not on sound financial sense, and it only makes sense that the players have been burned. Let the major instigators get burned a little more and get forced out of the marketplace by public anger. The small fry were never the problem, and if they jump out of the frying pan to a bit of safety, fine for them. We need to hold our officials and our lenders to higher standards.

[Wild Style]

Originally Posted by PATRAIN

I'm interested in how many people out there would just walk away from their mortgage if they can't sell there home within the next year? The reason I ask is my brother-in-law is considering it after only 1 year in his home. If this becomes the trend it's going to make things extra nasty. Now, I know some people are going to get uptight thinking about this, but getting upset doesn't make it all better. I'm just trying to see if our Gov't has any clue to what is a reality out there or is all the talk of walk-aways just talk.
Now, let's throw in the kitchen sink, If you have to stay what would you give up eg..t.v., dinners out ect. to keep your house? The people I know that have walked-away in PSL decided they weren't givin up notin....

not that I would be in this situation in the first place. But if it meant food on the table or house, I would choose food on the table.

[tallrick]

I saw this coming in 2002, and took a lot of laughs for it. The whole mess grew into something that lasted longer than I ever expected. The investors who bought those bundled mortgage "securities" deserve to lose money. I believe that if someone loses their job or cannot make ends meet walking away is the only way to go. Besides, they may be able to afford a home after the whole house of cards collapses. Hopefully this experience causes investors to avoid risky real estate.

[MrTudo]

Taking personal responsibility and integrity is becoming more and more scarce in this country.

[Sunshine Chick]

This is amazing and touchy. I believe that people signed the dotted line and it is a contract and therefore should be honored. Walking away will only hurt you chances of getting a home later on but it will always be added onto others in the long run who pay their payments.
For people to be talking about bailing people out is ridiculous, sure if you were scammed and it can be proven without any soubt you were I can see the government helping you, but not allowing you to walk, but stay and make an adjusted payment plan that you agree to continue. But to just bail out people who signed a contract to purchase a home and just give up because you signed a note that you should not have signed is wrong.
We all will pay for people bailing out. Why should those who pay their mortgages have to pay for those who wont because they did not read it or understand it when they signed it. We are all told at an early age if you do not understand something do not sign it or to get someone who does understand it to look at it "before" you sign it.
If you bought a home that you couldnt afford in the first place that is your fault.
I was reading that many people who are walking/bailing are those who refinanced their homes to the fake market values to pay off personal debt only to get back into personal debt and still owe the house. In that case no way should you be allowed to walk or stick a bank with it. They will only raise rates to others who have honored the contract and did right with their money. The article was very well written saying that many people in forclosure isnt because of the interest rates, its because they got themselves into personal debt problems and want and easy way out.
I want to sell my house too but my realtor is telling me that people's credit anymore is so trashed they have to go through tons of apps to just get someone qualified anymore.
If you have poor credit is your fault and not anyone elses fault. If you got yourself buried into debt and believe someone like the government or the bank should bail your out that is flat out wrong.

[Lilybeans]

Originally Posted by MrTudo

Taking personal responsibility and integrity is becoming more and more scarce in this country.

You are so right.

Walk away? There should be severe penalties, and shame.

[rusty78]

It is simply amazing what people are not willing to do without........for example... my neighbor was recently forclosed on... when the bank showed up... the husband had to call his brother's to come over...one with a pick up to tow his 25 foot boat out...the other to drive his new Mercedes....he was stuck riding off on his custom Harley.... the wife left in her relatively new BMW.... and their two sons drove off in their new cars.... one 17 and the other 19... all had cell phones.... they never cut their own grass... nor did they ever shovel the snow... instead........ they always hired someone to do it for them.... ....
The house they purchased...was way above their means...they got suckered into one of those teaser rate adjustable mortgages and bought a bigger house than they could afford.... when the rate adjusted three years later... they still could of afforded the house... but they would have had to of given up some of their toys.... as he said... he just could not live without his cell phone or Harley... so tell me... who else is guilty of walking away so that they don't have to do without......