Anybody walked away from their mortgage?

[bailey]

There's something troubling about several of the posts on this thread. Let me try to put my finger on it. Substitute a guy named Bob for whatever bank you might have in mind, and let's drop the amount of the loan down to something manageable, say $50, and let's say you borrowed $50 from Bob in order to buy some old comic books.

What many of you are saying is this: I borrowed $50 from Bob so I could buy some old comic books. Now, Bob lent me the $50, and I bought the old comic books. But now it turns out, hey, Bob's a pretty mean guy, and also it just so happens the old comic books are really only worth $20 or $30. So I think I won't pay Bob back, fuck him, and I'm OK with that since he's a mean sucker.

You know what? You borrowed the damned $50 and made a bad deal for yourself with it; too damned bad, you still owe Bob the $50 even if he is an asshole. Tough luck. As Judge Joe Brown would say, man up.

Of course the flip side of that is illustrated by Lowell's post above. Bob loans you 50 bucks, you end up paying $50 for some comics that are suddenly [[and completely irrationally) worth $200.00. I doubt you are going to go and split the proceeds with Bob, any more than Lowell offered to split the windfall proceeds with his lender. You're going to pay Bob his 50 and pocket the rest...and no one is crying for Bob.

[jackie5275]

Here's something from today's Detroit News that talks about the consequences.
http://www.detnews.com/article/20100...e-can-be-risky

I wouldn't like having a judgement against me where the bank can take my other assests in addition to the house.

[Huggybear]

Actually, the interesting little tidbit in there is that Fannie Mae won't approve you for a mortgage for 7 years after a walkaway. Hit the Fannie Mae site, and you'll see that Fannie Mae is now instructing its servicers to collect on deficiencies. Http://www.fanniemae.com/newsreleases/2010/5071.jhtml - even a workout will normally put you out 2-3 years under the new policy.

Fannie Mae has about 60% of all mortgages in the U.S.

So from a practical standpoint, the party's over.

Here's something from today's Detroit News that talks about the consequences.
http://www.detnews.com/article/20100...e-can-be-risky

I wouldn't like having a judgement against me where the bank can take my other assests in addition to the house.

[cman710]

Sounds good, but I call bullshit! This chart shows that after the age of 70 your probablility of being in a fatal crash grows exponentially. But I don't hear about the insurance companies gouging seniors the way they gouge teens. Its the whole "kick em when they're down" syndrome. Its alot easier to exploit those who are least in the position to defend themselves. Economically speaking, that is.

Kevgoblue,

What you said sounds great, except that it's not true. Insurance companies actually do charge senior citizens higher rates of auto insurance.

See here [["There are a varying number of different age classifications, within which premiums generally tend to decrease as a person matures. However, some insurers' statistics indicate that, beyond a certain age, driving skills deteriorate. This causes the claims experience of senior citizens as a group to worsen, causing various insurers to charge higher premiums for those higher-age categories. On the other hand, many senior citizens may benefit from those insurers that vary their prices by the number of miles a car is driven each year, since they may drive less than the average insured.")

See this article [["Auto insurance for senior citizens is often significantly more expensive than it is for drivers who are even just a little bit younger. This is because car insurance agencies anticipate higher rates of accidents and claims from aging drivers, and to make up for their potential loss based on that, higher monthly premium rates for coverage are charged.")

And this one [["older drivers may present a higher risk than other drivers, usually leading to higher auto insurance rates.")

And this one [["Another group disadvantaged by age when it comes to auto insurance are elders. Senior citizens are also subject to higher car insurance rates based on their age alone.")