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***NEPatriot*** · 01-12-2010, 08:02 PM

The Way We Live Now - Walk Away From Your Mortgage! - NYTimes.com

Quote:

And given that nearly a quarter of mortgages are underwater, and that 10 percent of mortgages are delinquent, White, of the University of Arizona, is surprised that more people haven’t walked. He thinks the desire to avoid shame is a factor, as are overblown fears of harm to credit ratings. Probably, homeowners also labor under a delusion that their homes will quickly return to value. White has argued that the government should stop perpetuating default “scare stories” and, indeed, should encourage borrowers to default when it’s in their economic interest. This would correct a prevailing imbalance: homeowners operate under a “powerful moral constraint” while lenders are busily trying to maximize profits. More important, it might get the system unstuck. If lenders feared an avalanche of strategic defaults, they would have an incentive to renegotiate loan terms. In theory, this could produce a wave of loan modifications — the very goal the Treasury has been pursuing to end the crisis.

No one says defaulting on a contract is pretty or that, in a perfectly functioning society, defaults would be the rule. But to put the onus for restraint on ordinary homeowners seems rather strange. If the Mortgage Bankers Association is against defaults, its members, presumably the experts in such matters, might take better care not to lend people more than their homes are worth.

It's a very good article. If you have time, read it. Let blow the whole thing up. I think that this author has a good point. Why do you want to pay more than what your house is worth?

If you can't make a payment and know that you are going to loose your house down the road, why don't you walk away from it RIGHT NOW?

alvinnf · 01-12-2010, 08:09 PM

Quote:

Originally Posted by NEPatriot

The Way We Live Now - Walk Away From Your Mortgage! - NYTimes.com

It's a very good article. If you have time, read it. Let blow the whole thing up. I think that this author has a good point. Why do you want to pay more than what your house is worth?

If you can't make a payment and know that you are going to loose your house down the road, why don't you walk away from it RIGHT NOW?

Well, because you would be tanking your neighbors property value in doing so. If everyone walked and didn't hold up to their responsibilities the only ones whom would suffer would be those that have been responsible not irresponsible. This isn't a video game where you just get to hit reset when things don't go your way. I am all for letting people abandon their property only under the caveat that they are never allowed to purchase a home again and will perpetually rent!

***NEPatriot*** · 01-12-2010, 08:15 PM

Quote:

Originally Posted by alvinnf

Well, because you would be tanking your neighbors property value in doing so.

The value of people's houses is going down anyway regardless of their making monthly payment.

alvinnf · 01-12-2010, 08:19 PM

Quote:

Originally Posted by NEPatriot

The value of people's houses is going down anyway regardless of their making monthly payment.

Sure, but let's not invite the apocalypse in the housing market. The sooner people start making their payment the sooner we see the bottom. We shouldn't race to the bottom because we think it's getting close.

***IcyPatriot*** · 01-12-2010, 09:47 PM

Quote:

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***Harry Boy*** · 01-13-2010, 08:23 AM

We Sit, We Wait, For The Messiah's Miracle's, We Sit, We Wait, For The Change We Can Believe In.

The Wars Still Rage, Troops Still Die, Terrorists Are Still Playing Soccer In The Sunshine Down In Club Gitmo, People Are Still Losing Their Homes, The Economy Is getting Worse By The Day, Our Filthy Scumsucking Politicians Still Spit In Our Face (copenhagen party) Our Jug Eared Dumbo Golden Boy President Still Struts Around In All His Arrogance Believing He Is The Master And Lord Of The Universe.

We Sit, We Wait, We Watch Them GRIN While They F-ck Us.

We Sit, We Wait, FOR THE CHANGE WE CAN BELIEVE IN.

THE MILITIA'S ARE GROWING AS WE SIT AND WAIT

PatriotsReign · 01-13-2010, 11:26 AM

Quote:

Originally Posted by alvinnf

Sure, but let's not invite the apocalypse in the housing market. The sooner people start making their payment the sooner we see the bottom. We shouldn't race to the bottom because we think it's getting close.

Actually, the sooner real estate bottoms out, the better. Just like the economy as a whole. Why would anyone want a slow decline and thus a slow recovery?