Should You Feel Guilty About Walking Away?

Misthos · Dec 23, 2009

On a side note.... how bad can this get? I agree with Anaconda regarding the shadow inventory. I know people that have been in the same house for almost two years and no payments!

I think this could get really ugly. I just don't see how Fannie and Freddie and FHA don't need more $$$$ in the future.

We have a long way to go, and I think Banks are far from out of the woods yet.

dandxg · Dec 23, 2009

Quote from Anaconda:

Your savings are not immune if you walk away. Chances are you will lose them all along with your home.

Not if you know how to hide/insulate them.

assclown · Dec 23, 2009

Quote from jnorty:

my savings are in and llc, my wifes name and ira's. i'm not in a community property state so they can't touch my money in wifes name as the house is in my name. have been moving lost of money to hard cold cash the past 12 months. its not fraudulent conveyance as i've been late on no payments to anyone. got all the bases covered.

Dude, they will shatter the LLC veil in about 3 minutes and get your wife under rico statutes.

Your up shit creek without a paddle.

Lucrum · Dec 23, 2009

Quote from xburbx:

walking away is theft as far as im concerned

I agree, unfortunately the days of individual pride and integrity are long gone.

From an integrity standpoint, we seem to be in the proverbial race to the bottom.

xburbx · Dec 24, 2009

you blame the government and people around you for allowing yourself to walk away but you were the one that originally put yourself over your head in the property

Quote from jnorty:

I'm thinking of walking right now. it will be a strategic default. i have big savings but its a 'business decision".i own a home i paid $1.9 mil for and its worth $800k as many of my neighbors have been foreclosed on. i have no equity in it as i sucked it all out. park of my reason for walking is my anger at the gov't for enriching banks with taxpayer money. i figure if the banks are making money hand of fist screw them and take a lose on my home. also it could take 20 years for my home to recover to its previous value. i don't need credit so it won't hurt me. i'm just tired as hell of the massive moral hazard that our gov't has encouraged so i figure i'll get my piece of the pie. this is what happens when nobody pays a price for there bad decisions. the haves want what the have nots are getting.

xburbx · Dec 24, 2009

my primary income is real estate investing. im very aware of how things work. i just dont agree with walking away with someone else's money. it's that simple.

Quote from Anaconda:

You do understand that they are consequences to these actions, such as foreclosure and deficiency judgments.

Something tells me you do not understand business or how to evaluate matters such as these from a business perspective.

xburbx · Dec 24, 2009

you are right, i havent but i would like to believe that if i had experienced it that it would not change my moral compass

Quote from Misthos:

To say what you just did, I bet you have never experienced poverty. I mean real poverty.

xburbx · Dec 24, 2009

correct, but it's still not an excuse to walk away with someones money. i understand that loans will always default but it is the mass mentality of walking away from homes that helped tank the economy. it is way to accepted

Quote from opt789:

But you can cut your loss at any time and walk away from the trade. Why canât you cut your loss on a home and walk away too? The laws and contracts specifically show that default is a possibility and that is why lenders charge what they charge and supposedly ask for credit ratings, down payments, etc. If the world you would like, where people never default, existed then the entire process would be different. As far as I know a world where every person and business paid back every loan has never, and will never exist.

Donât get me wrong, I agree completely with you in principle, but in todayâs reality it is not possible. My main point is that the lender knew the homeowner could default, and if the homeowner defaults in a legal way then there is no moral issue. No one lied, no one deceived, no one stole, it was simply a financial transaction.

TraderZones · Dec 24, 2009

People who walk away may not have much clue what that is going to do to their future job hopes. In a hypercompetitive economy, people with bad credit histories will learn that many companies use credit rating for a large number of professsional, perm jobs...

peilthetraveler · Dec 25, 2009

Quote from xburbx:

walking away is theft as far as im concerned

In my opinion it is not theft as long as you move out the month you decide to stop paying and dont trash the property and give the bank a deed in lieu of forclosure. After all, you bought the house for a set price, then you give the house back when you dont want it. They are getting the exact same product back. The banks wanted to screw with interest rates and do all sort of speculative things that messed with housing prices, so they should take the brunt of the damage. I mean...as a buyer, you put down at least 3%, you pay off principal every month and if you walk away and let the bank know and not try to stay in your house rent free for 6 months like some do, its not theft and actually the bank got some money back in mortgage payments
in what should have been a fair deal.