Better to just stop paying mortgage??
05-19-2010, 07:20 AM
#201
Bent = #1
25k is nothing.. My house would probably appraise for $10k below what I purchased it at 2 years ago. Think of the people that purchased $800k homes, but those homes are now valued at $400k... When you lose $400k then you are in deep shit, not $25k.
05-19-2010, 07:42 AM
#202
When we sold our townhome up in Maryland and bought our house in Jacksonville, we put no money down on our house in Jax. But we did have a second mortgage, that, as soon as we sold our house in Maryland four days later, we paid off the second mortgage, at which is was like putting 20% down. With that said, we are STILL $19K underwater. It sucks because hard-working people like my wife and I only got a house we could afford on ONE income (knowing she was going to get out of the Navy within two years) and we can't refinance. But low-lifes that can't afford their mortgages can either walk away or have more bargaining power. System is fuxored.
05-19-2010, 03:27 PM
#203
Team Owner
Get your 15 seconds of fame here http://www.wsbtv.com/news/23609745/detail.html
05-19-2010, 05:25 PM
#204
Bent = #1
Get your 15 seconds of fame here http://www.wsbtv.com/news/23609745/detail.html
06-01-2010, 12:13 PM
#205
http://finance.yahoo.com/news/Owners...276925797.html
Shame is overrated.
ST. PETERSBURG, Fla. — For Alex Pemberton and Susan Reboyras, foreclosure is becoming a way of life — something they did not want but are in no hurry to get out of.
Foreclosure has allowed them to stabilize the family business. Go to Outback occasionally for a steak. Take their gas-guzzling airboat out for the weekend. Visit the Hard Rock Casino.
“Instead of the house dragging us down, it’s become a life raft,” said Mr. Pemberton, who stopped paying the mortgage on their house here last summer. “It’s really been a blessing.”
Foreclosure has allowed them to stabilize the family business. Go to Outback occasionally for a steak. Take their gas-guzzling airboat out for the weekend. Visit the Hard Rock Casino.
“Instead of the house dragging us down, it’s become a life raft,” said Mr. Pemberton, who stopped paying the mortgage on their house here last summer. “It’s really been a blessing.”
But for borrowers like Jim Tsiogas, the benefits of not paying now outweigh any worries about the future.
“I stopped paying in August 2008,” said Mr. Tsiogas, who is in foreclosure on his house and two rental properties. “I told the lady at the bank, ‘I can’t afford $2,500. I can only afford $1,300.’ ”
Mr. Tsiogas, who lives on the coast south of St. Petersburg, blames his lenders for being unwilling to help when the crash began and his properties needed shoring up.
Their attitude seems to have changed since he went into foreclosure. Now their letters say things like “we’re willing to work with you.” But Mr. Tsiogas feels little urge to respond.
“I need another year,” he said, “and I’m going to be pretty comfortable.”
“I stopped paying in August 2008,” said Mr. Tsiogas, who is in foreclosure on his house and two rental properties. “I told the lady at the bank, ‘I can’t afford $2,500. I can only afford $1,300.’ ”
Mr. Tsiogas, who lives on the coast south of St. Petersburg, blames his lenders for being unwilling to help when the crash began and his properties needed shoring up.
Their attitude seems to have changed since he went into foreclosure. Now their letters say things like “we’re willing to work with you.” But Mr. Tsiogas feels little urge to respond.
“I need another year,” he said, “and I’m going to be pretty comfortable.”
06-01-2010, 02:36 PM
#206
06-01-2010, 05:30 PM
#207
People like that piss me off. I think there needs to exist some agency or something that kick people out after 90 days of being late on a payment or being in foreclosure. They're scamming the system and they know it. The prospect of being homeless should be a strong motivator of literally being kicked out to the street.
06-23-2010, 04:47 PM
#209
I feel the need...
Fannie Mae Will Deny New Loans to Homeowners Who Walk Away
June 23 (Bloomberg) -- Fannie Mae, the mortgage guarantor 80 percent owned by the U.S. government, will temporarily deny new loans to borrowers who deliberately default and walk away from their homes.
Borrowers who have the means to make mortgage payments and don’t work with lenders to restructure loans will be banned from obtaining new mortgages backed by Fannie Mae for seven years from the date of foreclosure, the company said today in a statement. Washington-based Fannie Mae, along with McLean, Virginia-based rival Freddie Mac, own or guarantee more than half of the $10.7 trillion U.S. mortgage market.
“Walking away from a mortgage is bad for borrowers and bad for communities,” Terence Edwards, Fannie Mae’s executive vice president for credit portfolio management, said in the statement. “Our approach is meant to deter the disturbing trend toward strategic defaulting,” he said, adding that the firm will take legal action against borrowers who use the tactic......
Borrowers who have the means to make mortgage payments and don’t work with lenders to restructure loans will be banned from obtaining new mortgages backed by Fannie Mae for seven years from the date of foreclosure, the company said today in a statement. Washington-based Fannie Mae, along with McLean, Virginia-based rival Freddie Mac, own or guarantee more than half of the $10.7 trillion U.S. mortgage market.
“Walking away from a mortgage is bad for borrowers and bad for communities,” Terence Edwards, Fannie Mae’s executive vice president for credit portfolio management, said in the statement. “Our approach is meant to deter the disturbing trend toward strategic defaulting,” he said, adding that the firm will take legal action against borrowers who use the tactic......
CLIFFS:
* FANNIE MAE INCREASES PENALTIES FOR BORROWERS WHO WALK AWAY
* FANNIE MAE SAYS SEVEN-YEAR LOCKOUT POLICY FOR STRATEGIC DEFAULTERS
* FANNIE MAE SAYS WILL ALSO TAKE LEGAL ACTION TO RECOUP THE OUTSTANDING MORTGAGE DEBT FROM BORROWERS WHO STRATEGICALLY DEFAULT
06-25-2010, 12:17 AM
#210
Drifting
I saw this in the newspaper today too and thought of this thread. I would think all creditors would look at these people very closely and not lend money to them for the seven years.
I imagine there could be some more tricks up the Government's sleeve (since Freddy/Fanny is owned by government essentially): garnish some of the Social Security Payments for the old folks doing this BS would a good first pass that would make sense. Also removing the child deduction credit from taxes for younger offenders would also be a big disincentive for doing this stuff- nobody said taxes were fair and the government needs the money.
I imagine there could be some more tricks up the Government's sleeve (since Freddy/Fanny is owned by government essentially): garnish some of the Social Security Payments for the old folks doing this BS would a good first pass that would make sense. Also removing the child deduction credit from taxes for younger offenders would also be a big disincentive for doing this stuff- nobody said taxes were fair and the government needs the money.
06-25-2010, 10:48 AM
#212
One on the right for me
If a homeowner is in that much trouble they will simply walk and then file a BK to the mortgage company is out of luck...I think fannie mae will just increase the number of bks being filed if they actively pursue those who stop paying the mortgage
06-25-2010, 12:13 PM
#215
Bent = #1
From the bank's perspective they can either let the homeowner live rent free or go after him and at least get the asset (house) back to try and sell.
06-25-2010, 12:17 PM
#216
Id love to rent for at LEAST the next decade until this disaster shakes out...
There is absolutely no reason to own a house at this point anymore, its not an investment, you dont get anything "more" for your money that you do with renting, the mortgage interest tax deduction certainly doesnt make up THAT much of a difference over renting, its a joke...
I think the vast majority of strategic defaulters are so disgusted with housing they could care less if it takes 7 (or more) years to be able to get back into the housing game.
06-25-2010, 12:25 PM
#217
And as far as some of the holier than thou landlords in here, for every one of you, there are several others who couldnt care less if their prospective tenant was a strategic defaulter. it has NOTHING to do with your ability to pay a monthly bill, it was an independant and isolated decision not reflective of a persons entire financial picture.
And even IF a landlord was shakey about renting to a defaulter, given that the defaulter has several months of mortgage free living while the bank drags its feet to foreclose, they now have a TON of cash to say "hey mr. landlord, if you are THAT concerned about my credit under the circumstances, ill pay you up FRONT for 6 months of rent!" something of that nature would be more than enough cushion to calm the concerns of 99% of landlords leaving only the 1% with their nose in the air discriminating against strategic defaulters, fuck them!!
IF their rental property ended up in a situation where the landlord could no longer find tenants at all and could not afford to keep up the building and pay the mortgage on it, what does the landlord do then? hmmmm....i wonder....oh yeah! they default! (or try to sell it at a loss) but anyhow, my point is made. Uppity landlords can eat shit, strategic default is no indication of anything other than someone wanting to move on from a bad investment just like any business would do.
06-25-2010, 01:20 PM
#218
No. Difference is is that in a business, if a person owns one, if they default or they go down or out of business, they generally lose a lot of money. If a person defaults on a mortgage, the person or business guaranteeing the loan (i.e. a bank) generally loses a lot of money, and the person doing the defaulting walks away. That is fucking bullshit.
06-25-2010, 03:48 PM
#219
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lol, house? who wants a house?
Id love to rent for at LEAST the next decade until this disaster shakes out...
There is absolutely no reason to own a house at this point anymore, its not an investment, you dont get anything "more" for your money that you do with renting, the mortgage interest tax deduction certainly doesnt make up THAT much of a difference over renting, its a joke...
I think the vast majority of strategic defaulters are so disgusted with housing they could care less if it takes 7 (or more) years to be able to get back into the housing game.
Id love to rent for at LEAST the next decade until this disaster shakes out...
There is absolutely no reason to own a house at this point anymore, its not an investment, you dont get anything "more" for your money that you do with renting, the mortgage interest tax deduction certainly doesnt make up THAT much of a difference over renting, its a joke...
I think the vast majority of strategic defaulters are so disgusted with housing they could care less if it takes 7 (or more) years to be able to get back into the housing game.
06-25-2010, 09:49 PM
#220
One on the right for me
No. Difference is is that in a business, if a person owns one, if they default or they go down or out of business, they generally lose a lot of money. If a person defaults on a mortgage, the person or business guaranteeing the loan (i.e. a bank) generally loses a lot of money, and the person doing the defaulting walks away. That is fucking bullshit.
06-25-2010, 11:20 PM
#221
05/5AT/Navi/ABP/Quartz
Even if the banks speed up and expedite the foreclosure process (what does a bank do that is EVER expeditious?? lol), it will still give defaulters several months of rent / mortgage free living. that time is invaluable as it allows the defaulter to build up a large some of cash very quickly.
And as far as some of the holier than thou landlords in here, for every one of you, there are several others who couldnt care less if their prospective tenant was a strategic defaulter. it has NOTHING to do with your ability to pay a monthly bill, it was an independant and isolated decision not reflective of a persons entire financial picture.
And even IF a landlord was shakey about renting to a defaulter, given that the defaulter has several months of mortgage free living while the bank drags its feet to foreclose, they now have a TON of cash to say "hey mr. landlord, if you are THAT concerned about my credit under the circumstances, ill pay you up FRONT for 6 months of rent!" something of that nature would be more than enough cushion to calm the concerns of 99% of landlords leaving only the 1% with their nose in the air discriminating against strategic defaulters, fuck them!!
IF their rental property ended up in a situation where the landlord could no longer find tenants at all and could not afford to keep up the building and pay the mortgage on it, what does the landlord do then? hmmmm....i wonder....oh yeah! they default! (or try to sell it at a loss) but anyhow, my point is made. Uppity landlords can eat shit, strategic default is no indication of anything other than someone wanting to move on from a bad investment just like any business would do.
And as far as some of the holier than thou landlords in here, for every one of you, there are several others who couldnt care less if their prospective tenant was a strategic defaulter. it has NOTHING to do with your ability to pay a monthly bill, it was an independant and isolated decision not reflective of a persons entire financial picture.
And even IF a landlord was shakey about renting to a defaulter, given that the defaulter has several months of mortgage free living while the bank drags its feet to foreclose, they now have a TON of cash to say "hey mr. landlord, if you are THAT concerned about my credit under the circumstances, ill pay you up FRONT for 6 months of rent!" something of that nature would be more than enough cushion to calm the concerns of 99% of landlords leaving only the 1% with their nose in the air discriminating against strategic defaulters, fuck them!!
IF their rental property ended up in a situation where the landlord could no longer find tenants at all and could not afford to keep up the building and pay the mortgage on it, what does the landlord do then? hmmmm....i wonder....oh yeah! they default! (or try to sell it at a loss) but anyhow, my point is made. Uppity landlords can eat shit, strategic default is no indication of anything other than someone wanting to move on from a bad investment just like any business would do.
06-26-2010, 01:57 AM
#222
Drifting
Even if the banks speed up and expedite the foreclosure process (what does a bank do that is EVER expeditious?? lol), it will still give defaulters several months of rent / mortgage free living. that time is invaluable as it allows the defaulter to build up a large some of cash very quickly.
And as far as some of the holier than thou landlords in here, for every one of you, there are several others who couldnt care less if their prospective tenant was a strategic defaulter. it has NOTHING to do with your ability to pay a monthly bill, it was an independant and isolated decision not reflective of a persons entire financial picture.
And even IF a landlord was shakey about renting to a defaulter, given that the defaulter has several months of mortgage free living while the bank drags its feet to foreclose, they now have a TON of cash to say "hey mr. landlord, if you are THAT concerned about my credit under the circumstances, ill pay you up FRONT for 6 months of rent!" something of that nature would be more than enough cushion to calm the concerns of 99% of landlords leaving only the 1% with their nose in the air discriminating against strategic defaulters, fuck them!!
IF their rental property ended up in a situation where the landlord could no longer find tenants at all and could not afford to keep up the building and pay the mortgage on it, what does the landlord do then? hmmmm....i wonder....oh yeah! they default! (or try to sell it at a loss) but anyhow, my point is made. Uppity landlords can eat shit, strategic default is no indication of anything other than someone wanting to move on from a bad investment just like any business would do.
And as far as some of the holier than thou landlords in here, for every one of you, there are several others who couldnt care less if their prospective tenant was a strategic defaulter. it has NOTHING to do with your ability to pay a monthly bill, it was an independant and isolated decision not reflective of a persons entire financial picture.
And even IF a landlord was shakey about renting to a defaulter, given that the defaulter has several months of mortgage free living while the bank drags its feet to foreclose, they now have a TON of cash to say "hey mr. landlord, if you are THAT concerned about my credit under the circumstances, ill pay you up FRONT for 6 months of rent!" something of that nature would be more than enough cushion to calm the concerns of 99% of landlords leaving only the 1% with their nose in the air discriminating against strategic defaulters, fuck them!!
IF their rental property ended up in a situation where the landlord could no longer find tenants at all and could not afford to keep up the building and pay the mortgage on it, what does the landlord do then? hmmmm....i wonder....oh yeah! they default! (or try to sell it at a loss) but anyhow, my point is made. Uppity landlords can eat shit, strategic default is no indication of anything other than someone wanting to move on from a bad investment just like any business would do.
Imagine if you bought a house with a 30 yr fixed rate mortgage at 4.5%. The house doubles in value 5 years later and you still want to live in the house- your kids are established in nearby schools and you just remodeled the kitchen and the house is now perfect. The bank abruptly decides to change your loan's terms and double your interest rate to 9%. The bank claims that because the inflation rate is now 20% that they are forced to either change the terms or call the loan and demand the full payment in cash now for balance on the loan. How would you feel about the bank? I think you would think the bank is screwing you and how dare they do that because you signed an agreement for a 30 yr fixed rate mortgage. The bank is not honoring the agreement set forth for a 4.5% 30 yr fixed rate mortgage. Isn't this a similar circumstance as people like Bubble who bought homes at the wrong time and are now underwater?
Believe me Bubba- it's nothing about being uppity or anything like that. It's about doing the honorable thing and not supporting people that do things that harm everyone. Landlords always allow for a vacancy factor so they have both savings and time to have some vacancy and find a tenant. Most savvy landlords also know not to accept large sums of cash from prospective tenants because it's a dead giveaway for trouble. That ploy won't get you in any decent house- just a dump in most cases.
All I can say is good luck.
08-02-2010, 02:56 PM
#224
I bought my house last June for $175k. The low value Zillow.com gives my house today is $161k. That's $14k in the hole. I suppose if I had the train of thought the OP has, I should walk away, right? However, I would never consider that and here's why:
- I bought a house that was reasonable for my income. Everyone told me "buy as much house as you possibly can afford." I am very glad I did NOT listen!
- When looking at prospective houses I considered what my life might be like 10-15 years from now and only looked at homes that would accommodate this. (For example: if I have two kids and one is a boy and the other is a girl...they each need their own bedroom.).
- I only put in offers on houses that I LOVED. Not liked...loved. If a house gave me a milligram of doubt, I moved on to the next
- I carefully considered where I was buying and made sure that there was little that would make me want to move in the future.
- And, most importantly. I went into buying a house as my HOME first, and an investment second.
Sure, I would love a bigger house and would love my house to madly appreciate in value...but I don't need either. Even if my house never appreciates in value, it's still my house. I can do whatever I want to it (within legal and fiancée limits, of course
) to make it my home.
- I bought a house that was reasonable for my income. Everyone told me "buy as much house as you possibly can afford." I am very glad I did NOT listen!
- When looking at prospective houses I considered what my life might be like 10-15 years from now and only looked at homes that would accommodate this. (For example: if I have two kids and one is a boy and the other is a girl...they each need their own bedroom.).
- I only put in offers on houses that I LOVED. Not liked...loved. If a house gave me a milligram of doubt, I moved on to the next
- I carefully considered where I was buying and made sure that there was little that would make me want to move in the future.
- And, most importantly. I went into buying a house as my HOME first, and an investment second.
Sure, I would love a bigger house and would love my house to madly appreciate in value...but I don't need either. Even if my house never appreciates in value, it's still my house. I can do whatever I want to it (within legal and fiancée limits, of course
) to make it my home.
08-03-2010, 12:35 AM
#225
Drifting
I had a similar story as Thunder- it was back in 1992 when I purchased our home and I had an even greater paper loss for a while. It took until 1995 before the house value broke even with purchase price.
I never once thought of walking because it was our home and I'm a long-term / big-picture type of guy. While we were underwater, I still made double the principal payments to quickly bring down the balance on the loan. We were not alone, many of our friends who bought homes at this time were in the same circumstance as us and nobody bailed on their loans. Our house is now paid off and doubled in value even in this down market.
It sometimes pays to persevere and take your lumps for a while- especially if you can afford to still make payments. The greatest investors in the world have sat on losses and patiently waited for their investments to recover in value. A home is different than an investment so we should be even more patient on our home values.
I really feel for the the folks that lost their jobs and simply can't make the payments now- that's unfortunate. Many of these people really wish to live in their homes but now can't afford to pay the loans. That's a completely different story than this thread.
It's unpredictable when today's market will recover, but I'm pretty sure home values will eventually recover and continue their upward trend in value and rents will continue to increase.
I never once thought of walking because it was our home and I'm a long-term / big-picture type of guy. While we were underwater, I still made double the principal payments to quickly bring down the balance on the loan. We were not alone, many of our friends who bought homes at this time were in the same circumstance as us and nobody bailed on their loans. Our house is now paid off and doubled in value even in this down market.
It sometimes pays to persevere and take your lumps for a while- especially if you can afford to still make payments. The greatest investors in the world have sat on losses and patiently waited for their investments to recover in value. A home is different than an investment so we should be even more patient on our home values.
I really feel for the the folks that lost their jobs and simply can't make the payments now- that's unfortunate. Many of these people really wish to live in their homes but now can't afford to pay the loans. That's a completely different story than this thread.
It's unpredictable when today's market will recover, but I'm pretty sure home values will eventually recover and continue their upward trend in value and rents will continue to increase.
08-03-2010, 12:51 PM
#226
Team Owner
08-03-2010, 03:02 PM
#227
Drifting
^ great doopster- not sure what the point of the link is besides reading about all the short-term merits of defaulting and how this company will take care of you- is that the point you're trying to make? It doesn't make it right to do on an ethical basis though. There are many businesses trying to profit from strategic defaults and youwalkaway is a big player in the field and their 'information' will support their business plan.
It's also no revelation why many people would choose to default when the home value drops > 10% because 10% is what many people put down and now their losing the banks money and not their own in their own mind. With the new loan requirements being 20% with increasing frequency it will be much harder for people to walk away and that is a good thing.
I have to go back to a point I made a month ago on this thread which is how would you feel if the bank changed the terms to your own 30yr fixed loan? Would you think that is fair? Isn't that what strategic defaulters are doing to the big-bad bank?
It's also no revelation why many people would choose to default when the home value drops > 10% because 10% is what many people put down and now their losing the banks money and not their own in their own mind. With the new loan requirements being 20% with increasing frequency it will be much harder for people to walk away and that is a good thing.
I have to go back to a point I made a month ago on this thread which is how would you feel if the bank changed the terms to your own 30yr fixed loan? Would you think that is fair? Isn't that what strategic defaulters are doing to the big-bad bank?
08-03-2010, 03:43 PM
#228
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We are lucky we're refinancing our 30 yr 80/20 into a 15 yr @ 4%. It should be a couple more weeks until closing. The house appraised for more than what we paid so i'm ok with that.
08-03-2010, 06:13 PM
#229
Drifting
The #1 goal is to pay of the house as soon as possible.
08-03-2010, 08:39 PM
#230
08-04-2010, 06:11 AM
#231
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With rates so low right now, I've been thinking about the same thing with my 30yr. Currently in a 4.875% that I refi'ed last spring. 15yrs won't ever get much under 4% so this may be a good time, just not sure if I want to be forced to pay so much more per month. Right now we pay 2 extra payments per year, but we don't NEED to and can stop if cash gets tight.
The #1 goal is to pay of the house as soon as possible.
The #1 goal is to pay of the house as soon as possible.
We purchased the house 4 years ago and this seemed like the best option. I am just glad rates are what they are.
08-05-2010, 07:22 AM
#232
Safety Car
I considered refi too, I'm currently at 5.75% 80/20 30 year fixed on the house I bought 7 1/2 years ago. But the closing costs make it really not worth it for me. So I will just stick with the mortgage I have now.
I really would like to sell the thing, but I'm sure the house isn't worth what I bought it for and after paying the closing costs and the agent, I won't net that much.
I really would like to sell the thing, but I'm sure the house isn't worth what I bought it for and after paying the closing costs and the agent, I won't net that much.
08-10-2010, 11:58 AM
#233
http://www.chicagobreakingnews.com/2...pplicants.html
Any comments on this??
Looks like the high-horse riders just lost some more ammuntition in this discussion...no longer can employers pull applicants credit report
Any comments on this??
Looks like the high-horse riders just lost some more ammuntition in this discussion...no longer can employers pull applicants credit report
08-10-2010, 12:05 PM
#234
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http://www.chicagobreakingnews.com/2...pplicants.html
Any comments on this??
Looks like the high-horse riders just lost some more ammuntition in this discussion...no longer can employers pull applicants credit report
Any comments on this??
Looks like the high-horse riders just lost some more ammuntition in this discussion...no longer can employers pull applicants credit report
Oh and it is only for the state of Illinois, not a national law.
08-10-2010, 12:06 PM
#235
08-10-2010, 12:15 PM
#237
I dont know why you are personally attacking me and are totally incapable of an adult conversation regarding this topic and the news that i posted. Nor do you know my personal situation or what i am doing with my finances.
08-10-2010, 12:22 PM
#238
http://www.chicagobreakingnews.com/2...pplicants.html
Any comments on this??
Looks like the high-horse riders just lost some more ammuntition in this discussion...no longer can employers pull applicants credit report
Any comments on this??
Looks like the high-horse riders just lost some more ammuntition in this discussion...no longer can employers pull applicants credit report
08-10-2010, 12:27 PM
#239
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and it was not meant to address you specifically (although that's certainly what it looks like).