Comments on: Break chains of mortgage morality, lawyer says

By: Wizcon

Wizcon — Mon, 30 Nov 2009 03:27:30 +0000

No it is not a good idea if its only for that reason. I have been watching house prices rise and fall for almost 40 yrs. They go up and down, as does interest rates. They will recover in value eventually. It just won’t happen as quickly as it did in the last 10 yrs. That was all artificial inflations based on the investment bundling. The foundation was all crumbly.

By: Sage

Sage — Sun, 29 Nov 2009 20:35:51 +0000

I think this article is addressing just those who owe more than their house is worth right now. I’m not sure defaulting on a mortgage just because at the time your house is not worth what is owed on it is a good idea.

I agree that it makes sense if you can’t afford the mortgage.

By: Wizcon

Wizcon — Sun, 29 Nov 2009 20:10:18 +0000

For those that cannot afford the mortgage it makes sense. Reasons for that could be loss of employment or rates that adjusted way up. Both of those make it almost impossible to refinance or modify when more is owed than what it is worth. The thing is, if they walk, the banks are left holding the bag. They will take a loss when they have to sell in a short sale. Not to mention upkeep etc.
I read somewhere that Obama is putting pressure on lenders to modify loans. A simple revision of the terms to a lower interest fixed rate would do wonders. But alas, the lenders and investors insist on holding onto the false dream of ungodly profits promised
back during the subprime era. Perhaps if the expectation of more bailouts goes away, they will be more condusive to modifying.