It’s estimated that one million Americans walked away from homes “underwater” or worth less than their mortgages even though they could afford the payments. Morley Safer reports on this trend, called strategic default, that threatens the economic recovery.


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Category: Real Estate, Video

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

6 Responses to “Mortgages: Walking Away”

  1. Nic says:

    And this little gem, on primetime national TV, is only going to lessen the shame of default which I suspect in most cases is the only thing keeping deeply underwater folk still paying.

  2. Sunny129 says:

    If Banksters have NO shame, no fairness or any scruples, why should the borrower feel guilty? It is purely business/Economic decision and NOTHING to do with MORALITY. The business ethics of Banks is to the BOTTOM LINE only!

    Remember M to Model accounting applies ONLY to Lenders to keep their declining values of MBSs off their balance sheet but NOT to the borrowers whose houses are valued at the M to MARKET value, at the real time! The bailout scandal was for the benefit to the irresponsible Zombie banks not for Taxpayers who are sold esoteric financial products with no regard to their affordability or credit situation. Govt efforts to re-inflate the value of houses will fail, miserably!

  3. kstills says:

    Sunny,

    I think it’s disengenuous to call the mortgage’s that were taken out by folks ‘esoteric financial products with no regard to their affordability….’

    I think the majority of folks knew what they were doing. They simply didn’t know how bad the downside was going to be. Caveat Emptor.

    That said, I could care less if they walked away, as long as they don’t get reamed later on for doing so. Consult an attorney before making any such decision.

    BTW, I thought the author contended that this was not the case? Could be wrong….

  4. CitizenWhy says:

    Wall Street and the government refuse to value anything at its real worth.

    Hope this trend continues. It’s a message to the mortgage holders: “You can’t have your cake and eat it too. Unless you lower the principal you can have this lemon back, thank you very much.”

    As these houses are abandoned the whole street will deteriorate and may end up abandoned. Two -three empty houses are enough to tip the street, especially if the other residents are also in underwater mortgages. Detroit here we come!

    This is another example of Larry Sommers at work. The Obama so-called mortgage rescue program was really just another bail-out for the financial institutions. It was not designed to benefit the homeowner since it did not reduce the principal.

    Pathetic example of making decisions with spread sheet and “maximizing profits” rather than looking at the facts on the ground.

  5. photosports says:

    Corporations walk away from their obligations every day. How many billions have Trump bondholders had to eat and they still lend him money. Why shouldn’t Joe Schmo do the same. Maybe they’ll give him a TV show.

  6. gasiosie says:

    What should they do if they were ripped off in the first place when they bought the house at inflated prices as a result of the irresponsible money policy by Greenspan & Bernanke. They have the right to find a way out of bubble prices.
    The banks got a bailout with taxpayer’s money, but these people can’t make a rational decision of starting over with current lower prices? What if they spend precious money in their overvalued homes and don’t have money for retirement or health problems?