Comments on: Should You Walk Away from Your Mortgage? http://cashmoneylife.com/walk-away-from-mortgage/ Money Management, Small Business, Career Thu, 09 Feb 2012 19:08:34 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: keith http://cashmoneylife.com/walk-away-from-mortgage/#comment-45393 keith Mon, 23 Jan 2012 03:40:09 +0000 http://cashmoneylife.com/?p=2203#comment-45393 The contract I signed states I pay a monthly payment or they take my house. Contract honored. Get over yourselves. The contract I signed states I pay a monthly payment or they take my house. Contract honored. Get over yourselves.

]]> By: Don http://cashmoneylife.com/walk-away-from-mortgage/#comment-33460 Don Thu, 07 Jul 2011 15:27:55 +0000 http://cashmoneylife.com/?p=2203#comment-33460 First, business is business and there is no compassion or moral responsibility on matters concerning business. If you are in business your sole goal is to make a profit. To often as a nation we fail to understand that each person should operate their financies as if the were in business and when we are not able to meet our finacial obligations we must make tough decisions. Letting a house go may be one of those decisions is no different than shutting down a factory and moving it to china. Yes it is painful but to paint the picture that one is morally wrong does not take into account todays realities. Our children should be taught personel finance and how capitalism really works. These principals will better prepare them for the future rather than blinding them by some abstract principal that implies it is immoral to make a business decision that places you in a better financial position. First, business is business and there is no compassion or moral responsibility on matters concerning business. If you are in business your sole goal is to make a profit. To often as a nation we fail to understand that each person should operate their financies as if the were in business and when we are not able to meet our finacial obligations we must make tough decisions. Letting a house go may be one of those decisions is no different than shutting down a factory and moving it to china. Yes it is painful but to paint the picture that one is morally wrong does not take into account todays realities. Our children should be taught personel finance and how capitalism really works. These principals will better prepare them for the future rather than blinding them by some abstract principal that implies it is immoral to make a business decision that places you in a better financial position.

]]> By: eddie http://cashmoneylife.com/walk-away-from-mortgage/#comment-32913 eddie Tue, 31 May 2011 20:39:35 +0000 http://cashmoneylife.com/?p=2203#comment-32913 Here's my dilema. Sadly most of the homes in my neighborhood now (California, Sacramento area) were bought through short sale or forclusures - so I'm pretty sure the people who bought it got it for a very low price. In the meantime my house lost so much value that there's no way for me to sell it. Now about a year ago due to salary reduction at my job I fell behind on my mortgage for 6 months but my bank was able modify my loan by reducing the interest rate from 5.4 down to 3.8%. Part of the agreement was to increased the principal and length of the loan due to back payments. Still I went ahead with the new agreement as I was able to afford the new mortgage. Until an unexpected expenses came up and then fell back to the same situation. SO back to the negotiating table one more time - went through the same back and forth, more documents and paperwork but was told that no more program was available and was advised to do a short sale. Did it, got 10 offers but all were low (agent said due to the area I'm at there's no way to get a higher value). Submitted the best offer to the bank and of course was rejected. But I still refused to give up so I applied again for another modification (against all hope) before they can proceed with foreclosure. Got the latest offer 4 days ago and have 10 days to decide whether to accept it or not. Here's the terms of the agreement: Rate stayed at 3.8 but the bank added the amount I owed to the principal while in negotiation (for 8 months) and on top of that the loan maturity date was extended to 2051 (40 year mortgage). loan went up from 388K+ to 401K+ (from whatever I saved - payed most of my other accounts/bills/second mort will not budge) So here's my dilemma: House is now worth 230K according to Zillow - but there's about 7 more houses on the market in my street alone - third house is the same model as mine and it's been on the market for more than a year now (that house is falling apart). should I accept this new offer to fulfill my end of the agreement or should I walk away? Thanks Ed Here’s my dilema.

Sadly most of the homes in my neighborhood now (California, Sacramento area) were bought through short sale or forclusures – so I’m pretty sure the people who bought it got it for a very low price. In the meantime my house lost so much value that there’s no way for me to sell it. Now about a year ago due to salary reduction at my job I fell behind on my mortgage for 6 months but my bank was able modify my loan by reducing the interest rate from 5.4 down to 3.8%. Part of the agreement was to increased the principal and length of the loan due to back payments. Still I went ahead with the new agreement as I was able to afford the new mortgage. Until an unexpected expenses came up and then fell back to the same situation.

SO back to the negotiating table one more time – went through the same back and forth, more documents and paperwork but was told that no more program was available and was advised to do a short sale. Did it, got 10 offers but all were low (agent said due to the area I’m at there’s no way to get a higher value). Submitted the best offer to the bank and of course was rejected. But I still refused to give up so I applied again for another modification (against all hope) before they can proceed with foreclosure.

Got the latest offer 4 days ago and have 10 days to decide whether to accept it or not.

Here’s the terms of the agreement:

Rate stayed at 3.8 but the bank added the amount I owed to the principal while in negotiation (for 8 months) and on top of that the loan maturity date was extended to 2051 (40 year mortgage).

loan went up from 388K+ to 401K+

(from whatever I saved – payed most of my other accounts/bills/second mort will not budge)

So here’s my dilemma:

House is now worth 230K according to Zillow – but there’s about 7 more houses on the market in my street alone – third house is the same model as mine and it’s been on the market for more than a year now (that house is falling apart).

should I accept this new offer to fulfill my end of the agreement or should I walk away?

Thanks
Ed

]]> By: NORM KIMBALL http://cashmoneylife.com/walk-away-from-mortgage/#comment-32760 NORM KIMBALL Mon, 23 May 2011 12:19:20 +0000 http://cashmoneylife.com/?p=2203#comment-32760 MY WIFE AND I BOUGHT A MOBILE HOME ON TWO ACS FIVE YEARS AGO,WE GAVE 30,000 CASH DOWN NOT BECAUSE WE HAD TO ,,IT WAS TO GET A SMALLER PAYMENT.WE PAID 145,000 FOR IT.NOW IT'S NOT WORTH 100,000 AND WE BUILT A 40BY 18 FOOT GARAGE HAD THE LAND INCLOSED WITH A FENCE,BUILT A SCREENROOM AND A BACK POUCH THAT SHOULD HAVE MADE IT WORTH MORE HERE IN FL.WE CALLED WELLS FARGO THAT HOLDS THE MORTGAGE TO SEE IF WE COULD REF. FOR A LOWER INTEREST RATE AND A SMALLER PAYMENT ,WAS TOLD NO BECAUSE IT WAS A MOBILE HOME,IT HAD TO BE A HOUSE THAT WAS BUILT,I SAID THE 30,000 DOWN PAID FOR THE HOME ,THEY JUST GAVE US MONEY FOR THE TWO AC'S.WELL THEY DIDN'T SEE IT THAT WAY,NOW WE DON'T KNOW IF WE SHOULD WALK AWAY OR NOT THE GAS BILL NOW IS FIVE TO SIX HUNDRED $$$ A MO.JUST TO GO TO WORK.WE ARE ROBBING PETE TO PAY PAUL DON'T KNOW HOW LONG WE CAN DO THIS.BUT IF WE WALK AWAY WE WALK AWAY FROM 50,000 OF OUR MONEY WE HAVE SPENT HERE,IT'S A HARD CALL SO BEFORE WE ALL SAY IT'S IMMORAL NOT TO STAY AND STICK IT OUT SOMETIMES IT'S NOT ALL ABOUT THAT.. MY WIFE AND I BOUGHT A MOBILE HOME ON TWO ACS FIVE YEARS AGO,WE GAVE 30,000 CASH DOWN NOT BECAUSE WE HAD TO ,,IT WAS TO GET A SMALLER PAYMENT.WE PAID 145,000 FOR IT.NOW IT’S NOT WORTH 100,000 AND WE BUILT A 40BY 18 FOOT GARAGE HAD THE LAND INCLOSED WITH A FENCE,BUILT A SCREENROOM AND A BACK POUCH THAT SHOULD HAVE MADE IT WORTH MORE HERE IN FL.WE CALLED WELLS FARGO THAT HOLDS THE MORTGAGE TO SEE IF WE COULD REF. FOR A LOWER INTEREST RATE AND A SMALLER PAYMENT ,WAS TOLD NO BECAUSE IT WAS A MOBILE HOME,IT HAD TO BE A HOUSE THAT WAS BUILT,I SAID THE 30,000 DOWN PAID FOR THE HOME ,THEY JUST GAVE US MONEY FOR THE TWO AC’S.WELL THEY DIDN’T SEE IT THAT WAY,NOW WE DON’T KNOW IF WE SHOULD WALK AWAY OR NOT THE GAS BILL NOW IS FIVE TO SIX HUNDRED $$$ A MO.JUST TO GO TO WORK.WE ARE ROBBING PETE TO PAY PAUL DON’T KNOW HOW LONG WE CAN DO THIS.BUT IF WE WALK AWAY WE WALK AWAY FROM 50,000 OF OUR MONEY WE HAVE SPENT HERE,IT’S A HARD CALL SO BEFORE WE ALL SAY IT’S IMMORAL NOT TO STAY AND STICK IT OUT SOMETIMES IT’S NOT ALL ABOUT THAT..

]]> By: Juke http://cashmoneylife.com/walk-away-from-mortgage/#comment-29517 Juke Wed, 23 Feb 2011 07:37:44 +0000 http://cashmoneylife.com/?p=2203#comment-29517 Oh Yeah I forgot to add that when I discussed the fact that my house was rotton and it was covered up when I bought it AS -IS My mortgage company told me to File it with my insurance company and if they denyed it to switch to another ins company and then file a claim with them. So they actually just gave me the advice to commit Insurance Fraud! And I'm the crook. Oh Well Oh Yeah I forgot to add that when I discussed the fact that my house was rotton and it was covered up when I bought it AS -IS My mortgage company told me to File it with my insurance company and if they denyed it to switch to another ins company and then file a claim with them. So they actually just gave me the advice to commit Insurance Fraud! And I’m the crook. Oh Well

]]> By: Juke http://cashmoneylife.com/walk-away-from-mortgage/#comment-29516 Juke Wed, 23 Feb 2011 07:02:04 +0000 http://cashmoneylife.com/?p=2203#comment-29516 yup! Thats Me the Walk out artist Credit score is a 530, house is falling apart,only 30k In negative equity. I Make 100k per year. I have four kids, Im in constant danger of losing my job due to the unstable oilfield. What I pay in my mortgage pays 2 months rent on a small very modest home. I could buy a doublewide with cash in two years if I walk out and default even after I file banckruptcy. Thus giving my kids a better future for an education cause I'll actually have the money to help pay for it. The cost of everything is going up but the actuall value is going down. Creditors have been dipping into my pockets for years. My wife supports my decision and looks foward to living in an old rent house out in the country. My house is over 30yrs old and yep I screwed up. I fell for all of the no money down first time homebuyer programs. I paid enough in interest last year that would have rented us a house for a year and a half. Yea I got a lil tax deduction, 2 of my kids are my step children that I cannot claim. and the child tax credit went from 2500 to 1000 per child. Which still left me oweing 7500 in taxes for 2010. Due to a 1099 during the slow times at work which I used the money to try to catch up on my mortgage instead of saving for tax time. Yep I'm one of those Irresponsible homeowners that keep crashing the Housing market. And go ahead feel free to pick on my grammer spelling typing education or the lack thereof. I wish I would have only stayed in my little trailer park house that I paid for through someone else defaulting. Man Those were the days. Sure I'll pay for my mistakes but i'm not gonna let my kids Pay, as it is Obama Has ensured they would pay no matter what. I had no idea what I was getting into by buying a home, it was the worst mistake of my life. yup! Thats Me the Walk out artist Credit score is a 530, house is falling apart,only 30k In negative equity. I Make 100k per year. I have four kids, Im in constant danger of losing my job due to the unstable oilfield. What I pay in my mortgage pays 2 months rent on a small very modest home. I could buy a doublewide with cash in two years if I walk out and default even after I file banckruptcy. Thus giving my kids a better future for an education cause I’ll actually have the money to help pay for it. The cost of everything is going up but the actuall value is going down. Creditors have been dipping into my pockets for years. My wife supports my decision and looks foward to living in an old rent house out in the country. My house is over 30yrs old and yep I screwed up. I fell for all of the no money down first time homebuyer programs. I paid enough in interest last year that would have rented us a house for a year and a half. Yea I got a lil tax deduction, 2 of my kids are my step children that I cannot claim. and the child tax credit went from 2500 to 1000 per child. Which still left me oweing 7500 in taxes for 2010. Due to a 1099 during the slow times at work which I used the money to try to catch up on my mortgage instead of saving for tax time. Yep I’m one of those Irresponsible homeowners that keep crashing the Housing market. And go ahead feel free to pick on my grammer spelling typing education or the lack thereof. I wish I would have only stayed in my little trailer park house that I paid for through someone else defaulting. Man Those were the days. Sure I’ll pay for my mistakes but i’m not gonna let my kids Pay, as it is Obama Has ensured they would pay no matter what. I had no idea what I was getting into by buying a home, it was the worst mistake of my life.

]]> By: JB http://cashmoneylife.com/walk-away-from-mortgage/#comment-25237 JB Tue, 24 Aug 2010 13:52:04 +0000 http://cashmoneylife.com/?p=2203#comment-25237 Kristen, So the banks dont have a "We can take your house if it doubles in value" clause, but they did almost that with their derivatives trading. The banks caused the collapse of the price of my house, which I bought for 145K in 1998, now worth about 30K. Here is the analogy I use for what happened. I bought a home for 145K in 1998, but in 2008, the banks came into my home and trashed the place, they flung feces on every surface, flooded the basement, smashed all the windows, spray painted FOOL-IDIOT on the side of my house, and now my home is worth 20% of the price I paid 12 years ago. Then to add insult to injury, the government came along and felt bad for the bankers getting feces on their thousand dollar suits, so the government gave them a huge bailout to buy new suits, and new golf clubs, caviar dinners,etc. Now the banks tell me I am immoral for wanting to walk away from the mess they created, the economic decline they caused. Is it so wrong for me to say to the banks, YOU BROKE IT--YOU BOUGHT IT! The people who caused this financial mess should be in prison, but instead, they are doing the exact same things that caused the crisis in the first place, only they got raises since then, big raises while the rest of us lost jobs or took furloughs or cuts in salary. I would like to see your follow-up article why its immoral for banks to strategicaly default, how those who trashed hundreds of millions of homeowners home values should be in prison, but they aren't, they are making more than ever before, trying to engineer the next economic crash/richboy bail-out. Kristen,
So the banks dont have a “We can take your house if it doubles in value” clause, but they did almost that with their derivatives trading. The banks caused the collapse of the price of my house, which I bought for 145K in 1998, now worth about 30K. Here is the analogy I use for what happened. I bought a home for 145K in 1998, but in 2008, the banks came into my home and trashed the place, they flung feces on every surface, flooded the basement, smashed all the windows, spray painted FOOL-IDIOT on the side of my house, and now my home is worth 20% of the price I paid 12 years ago. Then to add insult to injury, the government came along and felt bad for the bankers getting feces on their thousand dollar suits, so the government gave them a huge bailout to buy new suits, and new golf clubs, caviar dinners,etc. Now the banks tell me I am immoral for wanting to walk away from the mess they created, the economic decline they caused. Is it so wrong for me to say to the banks, YOU BROKE IT–YOU BOUGHT IT! The people who caused this financial mess should be in prison, but instead, they are doing the exact same things that caused the crisis in the first place, only they got raises since then, big raises while the rest of us lost jobs or took furloughs or cuts in salary. I would like to see your follow-up article why its immoral for banks to strategicaly default, how those who trashed hundreds of millions of homeowners home values should be in prison, but they aren’t, they are making more than ever before, trying to engineer the next economic crash/richboy bail-out.

]]> By: Charp http://cashmoneylife.com/walk-away-from-mortgage/#comment-23460 Charp Sun, 02 May 2010 20:50:05 +0000 http://cashmoneylife.com/?p=2203#comment-23460 I don't think it is a moral obligation to stick it out. The bank took the risk to loan the money, with a lot more knowledge about the housing market than the average consumer. But my biggest argument is that the bank has still made money from my loan. All of the interest that I have paid to date more that covers the amount underwater that the back would out if I was to default. I don’t think it is a moral obligation to stick it out. The bank took the risk to loan the money, with a lot more knowledge about the housing market than the average consumer. But my biggest argument is that the bank has still made money from my loan. All of the interest that I have paid to date more that covers the amount underwater that the back would out if I was to default.

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