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re: What's your opinion of people who are underwater on their mortgages?
Posted on 6/16/15 at 12:32 pm to gorillacoco
Posted on 6/16/15 at 12:32 pm to gorillacoco
You assume the risk of going underwater when you take on a mortgage. So far so good. The bank, however, does not assume the same risk (see bailout). THAT is the issue.
For the free market to arrive at an actual truthful economic value, the risk must be shared between both parties. And that is why I have no particular beef with people who choose after the banks were bailed out, to walk away from their mortgages. I wouldn't have done it, but when the whole thing is rigged in the bank's favor, I'm not going to waste energy blasting somebody either.
Were they ethical to walk away from ther mortgages? No.
Were they rational to walk away from their mortgage? Yes.
For the free market to arrive at an actual truthful economic value, the risk must be shared between both parties. And that is why I have no particular beef with people who choose after the banks were bailed out, to walk away from their mortgages. I wouldn't have done it, but when the whole thing is rigged in the bank's favor, I'm not going to waste energy blasting somebody either.
Were they ethical to walk away from ther mortgages? No.
Were they rational to walk away from their mortgage? Yes.
2
Posted on 6/16/15 at 12:43 pm to Lsupimp
quote:
Were they ethical to walk away from ther mortgages? No.
Were they rational to walk away from their mortgage? Yes.
I'm no expert, but, I thought that walking away and letting your home go into foreclosure should be an option to be considered for every underwater homeowner?
If walking away is the best financial option, why not do it?
Posted on 6/16/15 at 2:20 pm to Lsupimp
quote:
Were they ethical to walk away from ther mortgages? No.
Were they rational to walk away from their mortgage? Yes.
This makes quite a bit of sense to me, which is why I considered this a conundrum in the first place. You hear both sides of the story: some people who walked away from the mortgage at the expense of their credit rating, but at the gain of potentially tens of thousands of dollars. Pretty tough to cough up 30-60K (or more) to a mortgage company who will not be on the hook for their own risks, and when the guys down the street are just walking away.
I don't know what the answer is, and I'd have a hard time blaming someone for walking away from that amount of lost money.
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