You, of course, can default and/or declare bankruptcy. But do you really expect a "something for nothing" principle forgiveness or mortgage modification?
Mr. Mayopoulos is an idiot. He needs to tell me again why I should pay a $1,700 monthly mortgage payment that only results in a property that’s $50,000 underwater? I won’t live long enough to see the property’s value recover.
HAMP is set to cease operations by December 31, 2012. But the Obama administration and its supporters in Congress, their egalitarian worldview intact, can be counted on to find other ways to promote easy mortgage credit. The Federal Housing Administration is one such vehicle. FHA-insured mortgages, which are meant for first-time buyers and are inherently riskier than conventional loans, now account for around 30 percent of all originations, way up from 2 percent just a few years ago. Much of this reflects a deliberate effort by FHA, part of the Department of Housing and Urban Development, to reach high-risk borrowers. An article in the September 20 edition of Investor’s Business Daily puts it this way: “The subprime market as we knew it might be dead and buried. But it hasn’t really gone away. It’s just wearing new clothes - government-issued, by the Federal Housing Administration.”
The ongoing mortgage industry rescue, whether focused on the supply or the demand side, reflects a lack of understanding of the natural reality that eliminating the consequences of risky behavior unwittingly encourages similar behavior. The Home Affordable Modification Program is a prime example of why the never-ending quest for market “stability” is destabilizing over the long run. Minimizing business risk can be risky for a whole nation.
http://www.nlpc.org/stories/2010/10/04/obama-mortgage-modification-bailout-distorts-housing-market
There is, at the same time, a moral contract. The loss is caused by something outside our control, namely, really poor government policy. Why do I need to continue to take a hit for it?
This is my fourth home and the third one to take a loss. Generally, the market was upset by government intervention,m never with good result!
You mention bankruptcy. Why is that necessary? There is no “deficiency” here like so many other states.