The debate about the
hit a nerve, to say the least. Today, we hear from you:
Dear Beth, if you are familiar with the film
in 1976 there is the classic line, "I'm mad as hell and I'm not going to take it anymore." I guess that is where I and many other hard-working Americans are just now. That is why they are walking away in droves from their mortgages and are voting out the establishment. —
As a homeowner that is currently employing a strategic default, I take exception to your description of my decision as immoral. I chose to walk away in order to save myself financially from a bottomless pit. Should I risk my entire financial life, my family's financial life and my retirement on a single house? I don't believe that I did anything IMMORAL. I tried for a year to work things out with the bank, but THEY refused. They left me in a position to make a serious decision about my financial future. One that I didn't take lightly. One that will ruin my credit. One that I will be paying for years to come. I don't just get a free ride by walking away! —
Lynn, it's a shame so many people are finding themselves in this situation. I've talked with economists who question why more homeowners don't walk away for the very reasons you stated.
When I sign a contract, it is not just ink. I have given my word. Events can happen that make carrying out a contract and making good on your word impossible. Events that make it hard, uncomfortable, inconvenient and unprofitable are not reason enough to break your word. Just walking away from a binding contract should have a lasting effect on a person's ability to borrow again. —
I'll continue to follow the story, Bob, on how this affects credit scores.
I live in a condo that will probably be underwater come the 2011 appraisal and I don't want a
. What we need is for
to stop playing mommy and daddy, lower taxes and spending, then get out of the way and let a free market roar the economy back to life. —
Well, Steve, considering the feds already spent billions of dollars on bailout programs, it's a little late for the free market.
Two years ago, when I thought that we had slid as far as we would see in house prices, my wife and I decided to purchase our first house. Unfortunately, we were about eight to 10 months too early and there was another dip in house prices that fall ... Someone needs to do something for the people who are making their payments. The government and banks are forcing bad situations to happen. I couldn't imagine going to a doctor with the
and having them send me away because I didn't have
Good analogy, Mike, for the conundrum many people encounter when they try to talk with their lender.
I am curious if you would care to address in your column how an "underwater" homeowner deserves any more consideration than the investor/retiree who got decimated in the crash of 2008? I can't generate a whole lot of empathy for the underwater homeowner who wants to walk away from their obligation — or expects the government to develop a plan to bail them out — when there has been absolutely nothing done to "bail out" the now near destitute retiree or investor who lost most of their funds in a similar manner. What's the difference?
I hear you, Peter, but there are lots of differences between homes and the stock market. The big one being that most of us have only seen real-estate prices rise while the market is known to be a much riskier investment.
It is my understanding that "walking away" from one's mortgage is not that simple. Unlike a short sale or bankruptcy, I have read that banks will aggressively pursue money that is owed to them, particularly if the homeowner is solvent.
Beth Kassab can be reached at