walking away from a mortgage

[KTP]

I'm all for it. We need to increase revenue. Those making more than $250K can afford it. Those making $1M+ can really afford it.

Last comment in this thread I promise!

Awhile back I made a thread on here asking if people would be mad if their Roth IRA funds were taxed to pay for other people's retirement who did not manage to save as well. The amount of "NO!" shouting that followed was really amazing, even after I pointed out that those people with hefty Roth IRA balances really could afford it compared to someone who didn't save anything.

I guess people are always willing to take something from others if it doesn't hurt their wallet...

This is why I said "go for it" with the mortgage walk away...there is no morality left in the world.

[Snodog]

Can you explain how the rich are being soaked? Looks to me like they've never had it so good:

I really hate it when someone comes along and pours cold hard facts on a good rant. Why must accuracy always spoil our sense of outrage? Where's the fun in that?

[reallyprettyhappy]

Maybe I should have said moderately rich.

See Obama's new plan to eliminate tax cuts for married couples making more than 250,000 /yr but keep them for everyone else.

See Oregon's plan to have a special tax on those making more than 250,000/yr and Washington state eyeing that too.

Oregon approves ballot initiative to soak the rich on clarkhoward.com


Just because you choose not to see something doesn't mean it doesn't exist.

Could you please clarify how Washington state would accomplish that? Washington doesn't collect state income taxes, so I'm just wondering how that might work...

[feh]

might not be so easy to walk away

Came across this article this morning. Thought people might be interested...in some states, people might be on the hook for the outstanding mortgage balance minus what the bank can sell the house for :

Mortgage lenders pursue homeowners even after foreclosure - Feb. 3, 2010

[Radiance]

I had my shortsale documents reviewed by an excellent lawyer.

The wording is clear that after the short amount I owe zero and they can not come after deficiency.

If they try, I can sue them.

Instead of this time bombs I think people should be asked for financial proof of inability to pay. My bank asked for this. I also think it is misleading for a bank to approve a shortsale without clearly stating they will want the difference anyway. In the article the lady had to go bankrupcy, that doesn't benefit anybody!

A shortsale is beneficial to the bank over the foreclosure for many reasons, but as a customer if deficiencies are not forgiven, I have no motivation to go for shortsale, I rather foreclose. Effect on credit is the same and with foreclosure you get months of rent-free housing. At this point it is a financial decision.

I am very grateful mine was a shortsale, but I was ready to go for foreclosure if deficiency was still due. What kind of shortsale is that if the bank will not come up short?

After foreclosure, if it got to that point, I was ready to go bankrupcy. The way I see it, if I could pay the deficiency, I could keep my house, no?

[elessar78]

I think people feel like they can/should walk away because they viewed their house as ONLY an investment and now that the investment aspect is bunk there's no point in continuing to pay into it.

As a not-yet home owner (so take it with a grain of salt) I think one should look at a home as a place to live first and foremost and if it turns out to be a good investment then consider yourself lucky.

[Radiance]

I think one should look at a home as a place to live first and foremost and if it turns out to be a good investment then consider yourself lucky

I think that was almost everybody's initial intention; to buy a home as a place to live, but there was always an unspoken assumption that the lovely home will also be a source of income, sometimes year later, In the shape of refinancing for cash out or reverse mortgages. At the very least nobody expected to be paying for a home more than it is worth.
It was a given that the prices of homes ALWAYS go up over time, all the time.

I for one assumed that real state was ALWAYS a safe investment, no brainer. ...How often has the real state market crash like this? When was the last time? Does anybody know?

[disneysteve]

I think people feel like they can/should walk away because they viewed their house as ONLY an investment and now that the investment aspect is bunk there's no point in continuing to pay into it.

The problem is a house isn't like other investments because technically, you don't own it as long as you have a mortgage.

If I buy shares of stock and the price drops and I sell it, I'm out the money. That doesn't impact anyone else.

If I buy a house and borrow 100% of the purchase price from the bank and the price drops and I walk away, I'm out very little but I've screwed the lender.

That's part of why I have a problem with people doing this.

[arthurb999]

Not all crimes are punished with jail time. There can be fines. Wages can be garnished. Something could be done to make the deadbeat repay what is owed. Skipping out on a loan that you can afford to repay isn't okay no matter how people try to justify it.

Public flogging would work