Posted on 09/26/2010 7:41:50 AM PDT by Oldeconomybuyer
Millions of middle-income home- owners are struggling to pay down bloated, underwater mortgages while wealthier Americans are simply mailing in the keys to the mansion and calling it a day.
It's time for average Americans to start seeing their mortgage papers for what they are: records of financial transactions, not moral documents.
In a free-market society, an individual homeowner is not responsible for the strength of the nation's housing market. If anything, walkers may stimulate the economy, by spending a portion of the money they were sending to the banks each month.
Take a look at your finances and decide for yourself whether homeownership makes sense. A better decision for the future of your family may be to rent, pay off your credit cards, and put the savings in a college fund for your children or grandchildren.
Walk away from your house if it will be better for you to rent. And remember, walking away now doesn't mean that homeownership may not work for you later.
(Excerpt) Read more at mercurynews.com ...
Mixed feelings on this. It's easy for those of us lucky enough not be in this problem (me included) to say this.
But I have heard stories from people where it seems like an ok thing to let the house go.
But many others just don't want to do the hard work, and are looking for someone to blame for their greed and lack of responsibility.
I paid off my house, my car and every loan that I have ever made. I have never walked away from my responsibility. People who do are the reason we are in this mess!
I didn’t buy a new car, new house or try to keep up with my neighbors. I have lived in the same house for over twenty years, drove the same car for eighteen.
We paid off our business loan and we pay our employees every week WHAT WE OWE THEM (should we walk away from that too)?
I think you are on the wrong website. This is a conservative website where people take responsibily for the loans they make and repay what they signed a promise to pay.
Why should anyone ever trust this person again after he walked away from a PROMISE TO PAY.
BTW, I really don’t see what is so funny about it unless you think it’s funny he got away with not paying what he owed.
There are 25 million Americans looking for full time employment. 40 million are on food stamps. Do you really think that the vast majority of the over 1 million foreclosures this year are the result of people walking away from their responsibilities? It is hard to pay your bills if you don't have a job. That is the mess we are in right now.
I think you are on the wrong website. This is a conservative website where people take responsibily for the loans they make and repay what they signed a promise to pay.
A "promise to pay?" No, people signed mortgage agreements that provided the terms and conditions of that loan. If you don't pay, the bank takes your residence and kicks you and your family into the street. That "promise to pay" doesn't mean that you cash in your 401K, use your credit cards, and borrow from friends and neighbors to continue paying for a residence that you can no longer afford or want. Walking away is part of that "promise to pay." It is covered in the mortgage agreement. Conservatives believe in the Rule of Law.
BTW, I really don’t see what is so funny about it unless you think it’s funny he got away with not paying what he owed.
Got away with not paying? LOL. When you have your property confiscated including any down payment, closing costs, and previous mortgate payments, that is paying. The collateral for the loan is the property. Do you want someone to pay the remainder of the loan along with losing the property? How unreasonable can you be? Surely, you are joking.
>>he told me he had just bought another home in the same neighborhood. I noticed the realty sign in his yard and congratulated him on being able to sell - and he told me the house didn’t sell - that he was “letting the bank have it back.” During our conversation, he made it clear that he had bought the second one at a bargain price with this in mind.>>
He would only have been able to purchase the 2nd home for cash. Therefore, he now has an asset, and the bank will place a lien on it. I don’t see how this scheme would succeed.
You have no honor, understanding of honor or belief in it as a concept. The world in the hands of people like you is a dangerous and dark place. A promise is something to be broker if the circumstance favor it, and the penalties can be absorbed. Go forth and enjoy the fruits of a system wrought by people who believed otherwise.
You're right - and if we bailed out all the impulsive buyers, they'd multiply next time. Why be careful when there's no downside to bad judgement? I liked your reply, Marie.
“He would only have been able to purchase the 2nd home for cash.”
It isn’t wise, but it is definitely possible to have multiple mortgages. I wouldn’t do it again and would not recommend it, but I obtained a construction loan — and subsequently closed on the house I’m currently in — all while retaining my other mortgage.
“...the bank will place a lien on it. I don’t see how this scheme would succeed.”
He sure didn’t think it through for a number of reasons in my way of thinking. I’ll never know how it turned out, but wouldn’t any lien be removed once the original loan was satisfied?
At any rate, it seems there are an awful lot of people out there who have gotten away with such schemes because of who they are or who they know. Just look at the DC crowd.
And you just said it.
For the last seven years, the press has been buzzing with news of the "housing bubble". Anyone who bought a house in that time could not have gotten away from the understanding that their house's value was going to drop. If a person bought before that, they're probably breaking even right about now. We bought five years ago and had no doubt that our house's value was going down. People knew darn well what they were doing.
The large banks and lending companies were bailed out to the tune of billions of dollars.
And who's paying for that? *We* are. *All* of us are. Even the poorest person in the country pays hidden taxes on everything they buy - gasoline, electricity, clothes, food - it's taxed on one level or another. We're a country going broke and we must get a handle on this crap now. We can't afford to keep paying for individuals' mistakes.
It's *not* their home. They are living in a house that is owned by the bank.
“When did the army start promoting sleazy slimeballs past the butterbar stage? “
They alwyas have. Since when did someone being granted a commission mean they automatically stop being a slimball? The dirtiest politicians are military officers.
Based on what?
You, on the other hand, have by your own words demonstrated your lack of honor.
Today, I'll be going to court to file an opposition brief in a case in which a deadbeat, someone who believes as you do, is trying to get relief from their failure to answer a complaint. That person lacks honor. Even if I win, even if I get a judgment and collect, that person, as you do, lacks honor. See, the moral thing to do is to pay the debt, or make best efforts to pay the debt, not say "sue me" and then force the other side to collect. Having honor is why my client would never do business with this person again, and it's why my client, and I, can give our word to others and not be questioned about whether we will perform.
You, on the other hand, go into any deal with the knowledge that you will back out of it on a whim and say, "sue me". You will then use every dodge known to man during the suit, and try to weasel out of it. Then when you lose, you will hide assets and do what you can to keep the aggrieved party from collecting. If all those "honorable" actions fail, you will then declare bankruptcy if you can. If you can't go bankrupt, because you actually have the money, you will cause me to spend a lot more pursuing the debt than I should have had to.
And, because that conduct is not criminal, you claim it is not "immoral". It is simply you doing what the law allows you to do, breach a contract and then suffer the consequences that the law and the contract provide for. Breaching the contract in the first place, breaking that promise, is the immoral act. That you don't recognize this puts you in a category of person known as "sociopath".
The layperson term for people with your morality (actually, lack thereof) is "scum". I don't think it is insane to think that deadbeats are scum. I think it may be insane to engage a deadbeat in an argument about the morality of paying your obligations. They have no morality, and so it becomes like arguing with a pig. You can never get anywhere, and it just annoys the pig.
So, I am done engaging with you, madam.
“For some reason, people don’t *think* about getting a mortgage anymore. They don’t seriously weigh the issues that could come up. They don’t ask themselves, “What if we have to move and the house doesn’t sell??” “What if I loose my job?” “What if an emergency comes up and I need extra cash?” No. The average person believes that things will always continue as they are today”
That is very true, however, the market, from brokers to real estate agents used full court press propaganda to make everyone feel it was OK to buy anything they could as the market, well, as they say, “Home prices ALWAYS go up”. The funny and sad thing is that the real estate agents and brokers are still saying that propaganda; “Now is the time to buy, prices will only go up from here!”
Today, people are being extremely cautious. Extremely. People that would like to move up, don’t. People that could afford a home, rent. People that could rent stay home with their parents. Some are walking away from large mortgages and are renting. Some are buying smaller homes and then dumping their large mortgages. It seems there is a scramble to economize.
The wife and I knew, as you did, that bad times ahead could mean disaster if we overbought. I bough something 1/3 of what the banks, brokers, and agents said I should buy. It worked out perfectly. We sold last year at a premium price just before that local market collapsed. We are renting and looking at buying. Property prices are in the gutter and washing down the street. Half price on average and still sinking fast. We are finding homes a tad higher than we want to pay, but we’ll wait until the right home at a good price is found.
I could write a book!
Plus no property tax, home owner's insurance (of course, one should have renter's insurance) or repair maintenance expenses.
Walk away and save that $2,000 or so per month, and have close to $50,000 for a down payment in two years at about the time the real estate market will be near the bottom. Have $50,000 to put down; no lender will avoid making a loan.
You have many good points that I agree with, the main one being that the banks took the risk.
But why did they take the risks? It started with congress forcing them to. Then congress backed up that force with the taxpayer’s guarantee.
Once that guarantee was in place, the banks had nothing to loose and it was a free-for-all. banks began giving out loans that no banker in his right mind would’ve OKed just a few years ago. Bankers stopped looking 19 year old newlyweds in the eyes and saying, “You can’t afford this house.”
People flocked to get insane mortgages because they were hearing what they wanted to hear: They could have it all.
Now where does it end? In my eyes, *everybody* should’ve known better. Congress, the lenders, the people who signed for the loans... ALL are guilty.
If a homeowner *can* pay, then they should pay. If they cannot pay, then they have to bail. Understood.
But don’t be fooled into thinking that it’s the banks or the government who’ll take the hit. It’s *US*. The taxpayers. We will be the ones who will have to clean up this mess. We will be the ones who’ll have to live in a broken economy and anyone who walks away from their debt obligations will be contributing to the problem.
So, what you are saying is that you knew of the entire system of law, from hiding of assets to bankruptcy, yet, you took the risk to do business with the person in question. You failed to provide protections against the risks involved and want the legal system to protect you instead.
It seems you failed to honor yourself, and, as with the other sheeple, you want someone else to protect you from the risks you assumed.
In business there are few absolutes. Risk management is what business is all about, yet, having failed to manage your risks properly, you complain that the other person is without honor as though you didn’t know of these risks to begin with.
This isn’t about honor, it is about your betting the farm on risks that you failed to manage properly and are upset about it.
“Have $50,000 to put down; no lender will avoid making a loan.”
And that, my friend, is the bottom line statement to end all arguments. Cash is king and that FICO be damned.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.