Posted on 02/03/2010 7:05:10 AM PST by TigerLikesRooster
February 3, 2010
No Help in Sight, More Homeowners Walk Away
By DAVID STREITFELD
In 2006, Benjamin Koellmann bought a condominium in Miami Beach. By his calculation, it will be about the year 2025 before he can sell his modest home for what he paid. Or maybe 2040.
“People like me are beginning to feel like suckers,” Mr. Koellmann said. “Why not let it go in default and rent a better place for less?”
After three years of plunging real estate values, after the bailouts of the bankers and the revival of their million-dollar bonuses, after the Obama administration’s loan modification plan raised the expectations of many but satisfied only a few, a large group of distressed homeowners is wondering the same thing.
New research suggests that when a home’s value falls below 75 percent of the amount owed on the mortgage, the owner starts to think hard about walking away, even if he or she has the money to keep paying.
(Excerpt) Read more at nytimes.com ...
Its not such a credit rating hit these days. It takes about
4 years to recover, 7 years to have it drop.
You don’t expect someone to pay on a 4500/month note
on a property whose value is half the purchase price and trending down, do you. To think otherwize is to deny reality.
If you look back at my reply it does include that. Those offers will be for very high interest rates and low credit limit, I bet < $500. I would not want that. Plus most good jobs do a credit check too. Not good. With the Democrat reform bill these rates will be even higher to start, because they cant raise them on existing balances after the fact.
Credit cards are NOT a progressive redistribution system like Social Security is. Those that pay the balance every month are the kings and get cash back and no interest grace period. The suckers who use it for loans get high interest rates and fees and fines.
“In 2006, Benjamin Koellmann bought a condominium in Miami Beach. By his calculation, it will be about the year 2025 before he can sell his modest home for what he paid. Or maybe 2040.
“People like me are beginning to feel like suckers,” Mr. Koellmann said. “Why not let it go in default and rent a better place for less?”
Just great logic here. I think a stint in jail would help this f@#kwad appreciate his condo.
Oh, I don't know... Maybe because you SIGNED YOUR NAME ON A LEGAL CONTRACT!
People need to grow up, act like adults and quit whining about how unfair life is.
And now were are being TAXED TO DEATH. BY THE CURRENT POLITIANS!
It is not just the mortgages, the prices on the land were artificially inflated abover real value.
The real estate taxes were inflated which created municipal bloat.
Home prices continue to REMAIN inflated because of the banks holding back on a shadow inventory and not liquidating these abandoned homes or just compromising the artifically valued mortgage down 50-60% to reflect REAL value.
If I signed the mortgage papers and agreed to the terms then YES, I expect to meet the payments.
Do you walk away from your car payment too?
Sounds like it.
Dictators have no friends; only sacrifices.
You can believe what you like. All my vehicles are long since paid for.
So?
He signed a contract which outlined what would happen if he doesn't live up to his end of the bargain. the lender is, or should be unless he's stupid, protected in case of default.
Contracts are the very absence of moral obligation.
That sums it up quite well - we ARE broke. The next time the lib next to you starts bellyaching about the need for more ‘stimulus’ from the government, remind the idiot of that simple fact -
WE ARE BROKE!! THERE IS NO MORE MONEY TO SPEND!!!
I am a property manger and I rent apartments for a living. What makes this guy think I want to rent to someone that screwed up his credit.
You and I disagree completely.
When I sign my name, it means something. You should warn potential lenders and other business associates that this is not the case for you.
Friend of mine got a letter from her mortgage bank telling her she had 30 days to pay $4000 for Flood Insurance on 1.9 acres that has never ever flooded but is 50+ feet from a year round creek . . . very small, about 6 inches wide creek.
Friend has never been late on a mortgage payment even though they’re living on her husband’s VA and money she earns grooming dogs and kenneling dogs and cats . . . very variable income.
Our County just rescinded the homestead exemption and raised some other taxes. [Not being a homeowner, I didn’t pay much attention.]
Friend has decided to move to a rental [they can pay all bills with husband’s VA] and just let the bank take back their house and property. She loses the $5000 metal kennel building and fencing she added to worth of property. She loses the updates and improvements made in the house, the new tin roof and the wrap around patio.
She’s upset at losing her home, but at the same time has decided they’ll rent instead of own because there are less “hidden” expenses.
That’s why I rent . . . it’s not my hot water heater, roof, septic system, etc. AND I have a great relationship with my landlady . . . I get her hand me down dryer and washer and refrigerator.
Maybe Clark County should not have build such a palatial tower to house its employees.
In Texas, you can buy a pretty nice 1700 sf house for not much more than the cost of a buildable lot in Clark County, WA.
Me, too.
When I sign my name on a contract, it means that I will abide by the terms of the contract. It just happens, however, that the contract will contain terms of what will happen if I default.
"Defaulting" is not reneging on the contract; it's one contingency that should be, unless the lender is incompetent, accounted for in the terms of the contract.
"Contracts" make, or should make, the moral character of either party irrelevant.
That's their purpose.
K.
Be sure and explain your views to the loan officer when you apply for a loan. Let me know how that works out for you.
I was kind of being sarcastic.
Here's the problem with that. There's millions out there who had no business entering into this type of financial commitment. But plenty of lenders, who know better, went ahead and gave them the money anyway.
"In my opinion, I would agree with you for the individual who, through no part of his own, loses his job."
Or suffers reduced income during an economic meltdown caused by greedy lenders?
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