re: Is "walking away" from a mortgage wrong?

quote:

---

But to me, it is a business ethics issue.

---

That's a fair point to make.

If the bank is willing to work out something and the borrower leaves them with the keys anyway, then that's not above board.

But most of the situations that we hear of are when the borrower has tried for months to restructure the loan or sell the property and the bank forecloses anyway. I think the business ethics argument gives both ways.

(no message)

quote:

---

I think the business ethics argument gives both ways.

---

it does, just like the assume risk and the resulting damages

now i can see an argument for a moral issue if a bank DOES offer a new deal to a homeowner and THEN the homeowner walks away...or the homeowner misleading the bank in order to get "free" time living in the property. i get that. that's basically fraud/theft

It makes no difference to you, but one post above you call that theft. Just because you don't like your condo, I would consider it theft to stop paying a third party when you have the ability to do so.

quote:

---

Why do you think so many people regard it as a moral obligation, though?

---

That's a good question.

I think deep down everyone wants to stay in their home and honor their commitments. I think there is some since of "failure" that goes along with it, because once you could afford it and now you can't.

In my own experience, we really liked our house. We worked to get the loan modified but our lender couldn't meet us half way. So we did the short sale, even though I hated to do it.

quote:

---

I would consider it theft to stop paying a third party when you have the ability to do so.

---

why?

it's a business decision. the contract doesn't state that you will get extra penalties if you could pay it and choose not to

the contract says they will loan you x principal at y rate and you'll pay z/month back over a certain period of time. if you fail to pay z, they'll seize the house (assuming non-recourse states).

the person walking away will suffer consequences as a result. the secondary effects will be a huge ding to your credit that will take a long time to recover from. second, they will have lost on what they had already paid in terms of downpayment

ability to pay doesn't matter. the question is whether the costs from leaving (described above) are less than teh costs from staying and paying timely. if the costs from leaving are lower, then you leave.

quote:

---

For some people Ethics and Morals are one in the same.

---

other than the misleading i spoke of earlier, how is this an ethical or moral issue?

there is an agreement with defined penalties for breach. there are secondary costs to both as a result of the breach that are known before hand. where do ethics or morals come into play?

Its ridiculous. If you come home and your wife is being trained by asian midgets, are you staying with her because of the kinship contract by marriage?

Every situation is different, get off your high horses. Not saying its always right, but certianly not always wrong to break a contract

quote:

---

Your wife is the one who broke the contract in this situation. I would never be the first one to break a contract unless left with no other choice.

---

But would you be the first one to jump on the asian midget pain train?

Its a train... there would be a lot of them.

New thread: How many half naked asian midgets do you think you can fight off at once.