Posted on 02/22/2013 1:12:45 PM PST by ExxonPatrolUs
Home sales are slowly climbing back, thanks to investor demand, improving consumer confidence in housing, and the surprising return of former homeowners who once walked away from their commitments.
These so-called, "strategic defaulters," some of them investors and some owner-occupants, are coming back to the market, despite damaged credit, and apparently the market is welcoming them back.
(snip)
Crashing home prices and sketchy mortgage products caused millions of Americans to default on their loans and eventually lose their homes. For some, it was a tragic fight to the end to keep their single investment; for others it was a conscious decision to walk away from their mortgage commitments, given the real fact that they would likely not see home equity again for many years to come.
Some saw this as morally reprehensible, others as a sensible business decision.
(Excerpt) Read more at m.cnbc.com ...
A far bigger issue though is the federal government intervention in the transaction. When my tax dollars are used to subsidize real estate speculation, I get irritated. Homeowners and lenders who gambled and lost should absorb the entire loss on their own. Absorbing my tax dollars instead is stealing - and it is evil.
Well said!
Hardly.
Those banks have been collecting payments with interest while receiving near ZERO interest government money from the Fed. Why should they not "have some skin" in the losses just like the underwater sap who has already lost their life savings from the crash?
The deal was that the bank loans you money and you pay it back. The house just happened to be collateral for your obligation. If the house doesn’t satisfy the debt, they still owe.
Those people that walked away gave their word that they would pay back the money they borrowed. They didn’t. They broke their word. That’s the end of the story. You may not consider breaking your word to be morally reprehensible, but a lot of us still do.
A 30 year note at 2.7? Who is your bank?
People on here should get off their high horse.
Governments deeply in debt are serviced by the banks.
The little guy deserves the same consideration. If the most powerful people on the planet don’t have to play by the rules, why should we?
Rules are made to be broken.
The underwater sap who already lost his life savings in the crash is not a “strategic defaulter”.
This discussion is about strategic defaulters.
Look at the biggest “strategic defaulter” on the planet - the US government.
There are a long list of people behind it. The banks have to do business with them because the economy is going to suck for a long time.
If you don't care about your credit rating, go for it. Also, the short sale forgiveness exemption on primary residences expired at the end of last year.
No, sorry, can’t see it that way. It’s a business deal, not a moral pledge. If with party feels its more advantageous to break the contract and accept the penalty for doing so, they’re perfectly free to do so.
If the banks weren’t getting adequate collateral for the loans they issued, that’s their problem, not the borrower’s. I find their lending practices more irresponsible and morally reprehensible than people who make a rational decision to make their best financial move.
No, sorry, can’t see it that way. It’s a business deal, not a moral pledge. If with party feels its more advantageous to break the contract and accept the penalty for doing so, they’re perfectly free to do so.
If the banks weren’t getting adequate collateral for the loans they issued, that’s their problem, not the borrower’s. I find their lending practices more irresponsible and morally reprehensible than people who make a rational decision to make their best financial move.
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