Should I walk away from my "underwater" home?

by The Berean 113 Replies latest jw friends

  • The Berean
    The Berean


    After paying my mortgage faithfully for an "underwater" property, should financial institutions be entitled to tax money I have paid in order to compensate them for losses incurred due to their own mismanagement? Is that "ethical"?

  • VIII


    After paying my mortgage faithfully for an "underwater" property, should financial institutions be entitled to tax money I have paid in order to compensate them for losses incurred due to their own mismanagement? Is that "ethical"?

    What does one have to do with the other?

    If I pay my car payment faithfully (or my credit card bill), should a financial institution be entitled to tax money I paid in order to compensate them for losses incurred due to their own mismanagement?

    Is that ethical?

    Who the *F* cares?

    It's way too late to be worrying about it at this point.

    You just pointed out that you faithfully have paid your mortgage.

    So, you just want to walk away because other people are.

    Which all goes back to ethics.

    You either have them or you don't.

    Apparently, you don't.

    Do you know John? John Edwards? He's probably looking for an Aide. You might work out.

  • sammielee24

    The Sunday Times magazine has an interesting look at underwater home-owers by Roger Lowenstein.

    He asks:

    “Why should underwater homeowners behave any differently from banks?”

    John Courson, president and C.E.O. of the Mortgage Bankers Association, recently told The Wall Street Journal that homeowners who default on their mortgages should think about the “message” they will send to “their family and their kids and their friends.” Courson was implying that homeowners — record numbers of whom continue to default — have a responsibility to make good. He wasn’t referring to the people who have no choice, who can’t afford their payments. He was speaking about the rising number of folks who are voluntarily choosing not to pay.

    Such voluntary defaults are a new phenomenon . . . The housing collapse left 10.7 million families owing more than their homes are worth. So some of them are making a calculated decision to hang onto their money and let their homes go. Is this irresponsible?

    Businesses — in particular Wall Street banks — make such calculations routinely. Morgan Stanley recently decided to stop making payments on five San Francisco office buildings. A Morgan Stanley fund purchased the buildings at the height of the boom, and their value has plunged. Nobody has said Morgan Stanley is immoral — perhaps because no one assumed it was moral to begin with. But the average American, as if sprung from some Franklinesque mythology, is supposed to honor his debts, or so says the mortgage industry…

    That is a good question. Perhaps the better way to phrase it, is as follows:

    The decision to walk away from an home worth considerably less than its mortgage should be made strictly as a business decision; It should be devoid of emotion, sentimentality, and other non-monetary factors. There should be a fair and honest assessments of the gains (lowered cost of living expenses, less stress) and the downside (damage to credit score, possible litigation).

    It should be a calcualted business decision — just like the banks make.

  • The Berean
    The Berean


    Does anyone else notice what just happen here by the tone of VII's response? Rather than to reason on a question, the poster opted to assault my character ... Isn't that essentially the same technique used for decades by the WBTS to stifle freedom of expression? That is. get the questioner to doubt themselves ... Remember in this case the facts indicate that I have not missed or even been late on a mortgage payment ...

    Have we opened a sidebar here?

  • JeffT

    Berean, we can only judge you by what you write here.

    Again, speaking as an accountant, I'm not sure I'd want to do business with you. Are you going to find some way to rationalize going back on your word with me? That is what this is about.

  • JeffT

    Additional comment regarding the companies walking away from commercial properties. They were probably doing a deed in lieu of foreclosure. This is a legal agreement in which the bank agrees to take the property back. In essence, both sides have decided this is in their best interest. It is not the same thing as "just walking away." Which brings us back to you need a lawyer.

    Walking a way can also have severe tax consequences in that the IRS will treat the irradication of the debt as income to you.

  • The Berean
    The Berean


    This is a query. I keep hearing I am already guilty of thought rather than deed. Classic JW to me ... Sorry

  • VIII

    Didn't I mention that I was a GB member before I left?

    You are too funny!

    Just because *everybody's doing it* doesn't make *it* a good idea.

    If you are unhappy with the bail outs, tell your Congress Person. Or Senator.

    BTW, I was making a conjecture that you don't have any ethics. I never assaulted your character. You assumed I did.

  • bluesapphire

    Elsewhere is correct. The contract on a mortgage says that IF you do not pay, they will take your home back. That is the agreement. If you walk away, they get your house, they get to sell your house and they get to collect on that sale. The fact that they might lose as well as you has no moral significance. It is business not morals.

  • B-Rock

    The mortgage is a promise to pay on borrowed money. The house is just collateral. They can still go after you for deficiencies after foreclosure. In an up market, that wasn't likely. In a sharply down market it is much more likely with a foreclosure sale not covering the mortgage balance. You are far better off trying to negotiate and making an arrangement with the lender. But if they see that you are able to pay your contractual obligations and are just refusing to, they probably won't be changing anything.

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