Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Cap, I don't doubt that you have some knowledge about residential RE, nor that the moral relativism evident in your posts plays well in Sin City.
Actually Willy it used to play well in a heavy Catholic College. But that is what you fundamentalist call it....moral relativism...that is because in your infinite personal wisdom you have truth right? No grey? All sharp and clear? You get it directly from Christ when you were born again?
When you need to decide the hard ones Willy do you fast? Move to the the small room in the back? Flagellate yourself until the insight comes?
Quote:
But you are in over your head when you start trying to apply residential lending practices to commercial RE - particularly when it comes to loans to developers. Perhaps someone else will take the time to educate you on bad boy carve-outs and full recourse guarantees.
Anyone dumb enough to seek my advice on a commercial deal of scope would really have to be out of it. The only thing I can imagine that would be dumber would be to seek yours. A rigid fundamentalist trying to use his doctrinate position to advice a corporate client. The sad thing is that it might happen.
My use of the commercial example was merely to illustrate the point that "right" and acceptable business do not always align. You probably knew that Willy...but fundamentalism sometimes clouds the brain.
Quote:
And as far as your advice to investors who may own properties in limited liability entities, I wouldn't put a lot of stock in how you think liabilities can be avoided.
I would tend to ask a moral relativist lawyer in Nevada rather than a fundamentalist lawyer from Texas if I was trying to understand the use of LLC in connection with personal liablity. You may well disagree Willy. But from your view can one separate business and personal liability?
Different strokes for different folks, I guess. Like others said, I think it depends.....if I couldn't feed my kids or something, yeah, that would be an easy decision. But if I could afford it, as the original OP suggested, I would stay put.
I can smell the stench of the dead horse all the way over here in Orlando......:-)
wow. try some personal responsibility. if you ever told a future lender how you feel about your promise to pay, you would never get another loan. ever. so when you fail to explain your philosophy to your next would-be lender, you will be swindling them. i can only hope there aren't many out there with your attitude.
Austin if I do things right I may not ever need another lender, but regardless given the number of foreclosures I doubt I'll have trouble finding one. Espeically given that my credit will be better than 95% of the other people who went through foreclosure as all my debt other than student loans is paid off. With the rate houses are falling I could outright buy a house in about 6-7 years in all likelyhood. Again I ask you where was the banks promise that my property values would not go down? I guess I forgot to get it in writing so it didn't actually happen by them? Why do I have to pay $6000 in property taxes while someone who bought the same house in 1999 is paying $2000. There is no fairness, everyone does what is best for their own situation. Also I live in CA and have never refiananced so the lender has 0 recourse otherwise I obviously wouldn't be doing this.
I actually do think the lender should have recourse to a degree and maybe it would have prevented everything from getting so bad. To make matters wores the government passed the law at the end of 2007 that makes all debt forgiveness on a primary residence non-taxable. If someone wants to give you a get out of jail free card woudln't you be dumb to not use it? If the governor pardoned someone for a crime, who would sit and jail and say I need to repay my debt to society? Why would I want to stay in a neighborhood where half the homes are empty and property values continue in a downward spiral? The only people I feel at all remorseful towards are the neighbors who do elect to stay and fight(the few that there are).
Trust me, there are a lot of people with my attitude, just not as many talking about it. I have 3 Co-Workers that are taking a similiar path. Some have a situation that is slightly worse than mine, but the premise is basically the same. Home is worth Jack so save up 6-9 months worth of payments and move when they tell you. This fulfills my obligation on the loan, I won't even be stalling the foreclosure process. In case you hadn't noticed I'm not asking for your help or anyone elses. If the bank wants to save some money I would be willing to cut a deal with them, but I consider this a favor to the bank. If the government chooses to use your tax dollars to bail out the institutions that created this bubble, that is not me asking for your help.
This isn't something I have taken lightly. I've spent 10 years building up my 800+ FICO. I don't think I've missed or not made a payment on anything in my whole life until this month. The reason I feel justified in this is because I believe the banks are the reason this situation happened. The bank officers assured me when I expressed concern about the market that my home would holds its value. They told me a lot of people are nervous when they buy their first home, but it is something that everyone has to do at some point. I have a hard time understanding why someone with so many interests to protect was adament about getting me into this loan. I never should have been given a loan for 6X my annual salary with 0 money down. If I had money down I'd want to fight until I got my money back. Becaues the banks were giving these types of loans and worse in many situations(I'm not in an ARM), it caused this massive bubble. Sure there is personal responsiblity and in my case it means anyone who see my credit for the next 7 years and I will have to give some sort of explanation. I've been watching the market since closely since January of 07 and told myself if my house becomes worth less than half of what I paid that i'd have to seroiusly consider walking. That day has come and gone and the market continues its downward spiral. The banks have done nothing to stop it or even ease it for that matter. This is not something that I am doing on a whim, I can't see any other logical response to what has happened. Financially things will be more difficult for my entire life if I don't erase this debt now.
Again I ask you where was the banks promise that my property values would not go down?
Perhaps they should guaranty that every stupid decision anyone ever makes will not come back to bite them. Wouldn't that make us all feel better?
Quote:
Originally Posted by dgrilley
Why do I have to pay $6000 in property taxes while someone who bought the same house in 1999 is paying $2000. There is no fairness, everyone does what is best for their own situation.
Yeah! And I don't make as much money as Joe Schmoe.
Quote:
Originally Posted by dgrilley
I actually do think the lender should have recourse to a degree and maybe it would have prevented everything from getting so bad.
You got that right. It's obvious that many people will break their promise if they think no one is looking.
Quote:
Originally Posted by dgrilley
If the governor pardoned someone for a crime, who would sit and jail and say I need to repay my debt to society?
Again, a common mistake that is being made on this thread. Your punishment does not affect whether or not the crime was ethical.
Quote:
Originally Posted by dgrilley
Why would I want to stay in a neighborhood where half the homes are empty and property values continue in a downward spiral?
Because you promised that you would pay back the hundreds of thousands of dollars someone handed you?
Quote:
Originally Posted by dgrilley
Trust me, there are a lot of people with my attitude...
That is all too evident. I just wish you all would identify yourselves so the rest of us would be able to avoid doing business with you.
Quote:
Originally Posted by dgrilley
Home is worth Jack so save up 6-9 months worth of payments and move when they tell you. This fulfills my obligation on the loan, I won't even be stalling the foreclosure process.
It fulfills nothing. It is a broken promise and nothing you say changes that fact. You can rationalize that there are circumstances that excuse your actions, but it is ridiculous to claim that you are fulfilling your promise.
Quote:
Originally Posted by dgrilley
The reason I feel justified in this is because I believe the banks are the reason this situation happened. The bank officers assured me when I expressed concern about the market that my home would holds its value.
Of course you do. You are not responsible for your own decisions. How crazy would that be?
Quote:
Originally Posted by dgrilley
The banks have done nothing to stop it or even ease it for that matter.
What have you done? Other than foolishly spend more money than you could afford on a house that was not worth what you thought it was?
Quote:
Originally Posted by dgrilley
This is not something that I am doing on a whim
It actually would make you look like less of a cheater if you were doing it without much thought.
Quote:
Originally Posted by dgrilley
Financially things will be more difficult for my entire life if I don't erase this debt now.
Having to live with the repercussions of your decisions? We can't have that, now can we?
I and many others here support you completely dgrilley. If it makes sense for you to walk away then do so with no qualms whatsoever.
When you signed your mortgage, you did not merely agree to make payments every month on your mortgage. You didn't even agree to do it "except when you are financially unable to do so". What you agreed with your bank was that you would do one of two things. Either (a) you make your monthly payments and stay in your home, or (b) you do not, and the bank gets the title to your home. THAT'S THE TOTALITY OF THE MORTGAGE CONTRACT.
Both options are clearly spelled out in the contract and within the framework of state law. If you choose to exercise option (b), you are fulfilling the terms of your contract, not skating through some "loophole." The mortgagor is not some innocent who had no idea that people can default on their mortgages. Nor was the mortgagor compelled to make the loan to you. The chose to do it and unfortunately during the housing bubble, they chose to do it with no regard to people's incomes or the value of collateral in protecting their loans in the case of default.
In fact, THE MORTGAGOR IS BEING COMPENSATED FOR TAKING THE RISK OF YOUR DEFAULTING FROM THE MOMENT YOU START PAYMENTS. Why, exactly, do people think that you have to pay a higher interest rate for your mortgage if your credit score is lower? It's because you're seen as a greater risk to default, and thus you are paying extra money to the mortgagor every month to compensate for that risk! (Not to mention PMI.) In other words, you are giving the bank extra money precisely because you have option (b). You have bought and paid for that option AND HAVE EVERY RIGHT TO TAKE IT.
My point is that your action is moral because you are honoring your word. You are doing precisely what you agreed to do and what you paid to have the right to do, openly and honestly.
Thankfully at least 60% of the populace, based on this tiny poll at least, are trustworthy.
You make good points, AW, but I bet that the 60% aren't in the 40% shoes right now.
I'd like to hear from anyone that is now in a home for 1/2 of what it's worth, can't feed their kids, don't have a job, are alone in their neighborhood because of other foreclosures, but are still going to stay in their home because it's their moral decision. Anyone? I'm not knocking it, I'd just like to know.
I'm glad that I don't have these decisions to make, as I just bought a home. But I certainly don't feel good about the folks that are in these messes right now. The ones that are still driving the Escalades and have the kids in private school? Not so much. But there are still folks out there that might not have any other choice. I don't think it's right that on top of it all we are going to say they are morally wrong.
When you signed your mortgage, you did not agree to make payments every month on your mortgage no matter what even it it means working 84 hours a week or liquidating your retirement savings or money for college for the kids. You and your bank simply agreed that you would do one of two things. Either (a) you make your monthly payments and stay in your home, or (b) you do not, and the bank gets the title to your home. THAT'S THE TOTALITY OF THE MORTGAGE CONTRACT. PERIOD.
People that claim that a mortgage is some sacred obligation which means you have to do "everything possible" to pay the mortgage simply are projecting into what they believe mortgages "should be" rather than what they actually are which is simply an agreement to make the payments or face foreclosure, nothing more nothing less. A mortgage is no different than any other contractual agreement, of which businesses and corporations and individuals withdraw from (and accept the agreed upon consequences of doing so) routinely with no moral judgment made upon them.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
