Maryland debt laws re: mortgage (Baltimore, North Beach: apartment, renters, HOA fees) - (MD) - Page 5 - City-Data Forum

Cruzincat · 06-06-2011, 06:36 PM

Quote:

Originally Posted by Richard Martin

The bank didn't sell you anything.

And if you couldn't tell that homes were in a gigantic bubble then there's a bridge in Brooklyn I'd like to sell you too.

Were some people preyed upon? Yup. But the huge majority knew what they were doing, particularly those that were speculating. And those that took out ARM mortgages. Don't get mad at the banks if you're one of those people that jumped on the property ladder and decided that it was a good idea because "real estate never looses value, it only goes up".

I disagree. The bank agreed to buy the home for you with cash, and you, in turn, are buying it back from them with monthly payments. The people who are really hurting are not the ones that could not afford the payments and got behind. It's the ones that counted on the value of the house being there when it came time to downsize after the kids grew up, or the ones that got a mortrgage for 30 years even though they were 50 at the time, thinking that when it came time to retire they could sell the house and have a little bit of cash to live on when they retire. They did not cause the problem. But they are suffering with it. Can you blame them for struggling until they have to do something drastic in order to survive?

westsideboy · 06-06-2011, 06:54 PM

A house is worth whatever someone is willing to pay to buy it. Period. When people stopped being able/willing to pay as much for housing, the prices dropped. Appreciation in housing value isn't real money until the house is sold and money is in your pocket. Until then it is just speculation. Anybody who bought a house with the expectation to make money off of it, rather than to LIVE IN IT is rolling the dice. Sometimes you win, sometimes you lose. It really isn't rocket science.

Cruzincat · 06-06-2011, 07:14 PM

Quote:

Originally Posted by westsideboy

A house is worth whatever someone is willing to pay to buy it. Period. When people stopped being able/willing to pay as much for housing, the prices dropped. Appreciation in housing value isn't real money until the house is sold and money is in your pocket. Until then it is just speculation. Anybody who bought a house with the expectation to make money off of it, rather than to LIVE IN IT is rolling the dice. Sometimes you win, sometimes you lose. It really isn't rocket science.

Most people in the past bought homes because they needed a place to live and it was generally thought that they would continue to increase in value. Most people can still afford to make those payments and continue to as long as there is no reason to have to sell. It's those that have to sell that are the ones getting screwed by the banks that caused the current problems, whether it is the bank they hold their mortgage or not. If it takes 20+ years for the values to come back to where it was in 2007, which is very likely to be the case, the smart move may end up being the strategic default for some. How many people actually live in the same house for 30 years anymore? That is what some people are being told they will have to do, even if they are facing retirement, knowing they cannot afford to keep making the payments on the reduced income.

westsideboy · 06-06-2011, 07:29 PM

I think you hit the nail on the head. People aren't satisfied with just living a normal low debt life. People want 2 or 3 cars, cell phones for each family member, cable TV, yearly vacations, a big home that they can only afford by commuting 40 + miles each way and betting the house will go up in value so they can sell out later for the nest egg they haven't been saving.

I think that lifestyle is coming to end. America is coming back to what is reality for the rest of the world.

By the way, what is wrong living in the same house for 30 years? That used to be the norm a couple of generations ago. This "move up" the housing ladder mentality is a new phenomenon.

Richard Martin · 06-09-2011, 04:38 AM

Quote:

Originally Posted by Cruzincat

I disagree. The bank agreed to buy the home for you with cash, and you, in turn, are buying it back from them with monthly payments.

So what you're trying to say is that the bank approached you and said that they had a house for sale? Or did you approach the bank, fill out a mortgage application, and hand it to them?

And at no point in time did the bank ever own the home. It transferred directly from the previous owner to you. You simply borrowed X amount of money from the bank and agreed to use the house as collateral. It is identical to buying a car, just a whole lot more paperwork.

Cruzincat · 06-11-2011, 07:40 AM

While you may be technically correct, the house is being purchased in a partnership with the bank, where the bank provides most of the money, you promise to pay the bank back(not the seller) over time and at any time if you are late in making said payments, the bank can exercise its option to cut you out of the deal entirely.

Lets say there is a fire and the house is destroyed. The bank still wants you to pay per the agreement. In order to enter the partnership agreement the buyer is required by the bank to buy insurance. Why? because the bank knows that if the equity in the home disappears, the buyer will walk away letting them holding the bag. If there were no insurance, how many people would still pay the bank? Even the most moral people in this circumstance would be hard pressed to pay off the loan and still have to find a place to live. The bank knows this and makes a business decision to make the loan conditional on the insurance. Why? To protect their interest, the interest being their peoperty. It is their property even if the true name is only having a lien on it. The bank calls all the shots. The only thing a "buyer" can do is always make the payments until it is paid off entirely. Any homeowner knows that the house is truly not their own until it is lien free.

DanoMD · 06-22-2011, 10:06 AM

The banks have assured themselves no respect When the greedy subprime mortgage lenders took advantage of people and downplayed the risk in order to secure a loan at any cost (see used car salesman).

I see no dishonor in strategic default given the dishonor first practiced by our trusted financial institutions. Quid pro quo!

westsideboy · 06-23-2011, 07:17 AM

Who's the more foolish? The fool, or the fool who follows him? - Obi-Wan Kenobi

RetiredandProud · 06-25-2011, 05:12 AM

Your spouse should talk with his lender to discuss this matter. Unless he is behind on payments, I personally would not be overly concerned about being 70K underwater. Simply stay where you are and continue to weather the storm. It might seem like a long ride, however it is much better to stay put than to have bad credit for seven years. Having bad credit might also prevent your spouse from obtaining a job in the future or loosing his current one, if he is required to have a clearance.

Here's a link with information:
Maryland Foreclosures - Foreclosure Process in Maryland - Refinance in Maryland - Avoid Foreclosure in MD - Baltimore - Forclosure

hairmetal4ever · 06-28-2011, 06:49 AM

Quote:

Originally Posted by MDhomeowner

My husband bought a townhouse in Frederick before I met him. The mortgage is in his name only. Presently we are 70k underwater and seriously considering a "strategic default". What are the laws in Maryland? Can a bank come after my husband if we just walk away??

I believe MD is a "recourse" state, meaning they can come after you for the balance left after the bank takes and resells the house.