IS IT OK TO WALK AWAY?
A majority of Americans say it is "unacceptable" for homeowners to stop making their mortgage payments and abandon their homes, according to a Pew Research Center survey. But more than a third (36%) say the practice of "walking away" from a home mortgage is acceptable, at least under certain circumstances.
36 percent of Americans believe it is OK to simply stop paying your mortgage payment – even if it is affordable. That number includes 19 percent who that have no problem at all with the idea and 17 percent who think it is acceptable in some circumstances.
However, 59% of all Americans believe that if you walk away from your mortgage, your actions are simply unacceptable.
21% [of all homeowners] say they owe more on their mortgages than their home is worth...
Nearly half (48%) of all homeowners say the value of their home declined during the recession, and as a group they are more likely than those whose home did not lose value to say it's acceptable to renege on a mortgage (20% vs. 14%).
But if YOU are in a home that is underwater and upside down, does it really matter what other people think? However, consider this from the report...
Caught between big mortgages, sinking home values and the financial strains associated with periods of high unemployment, many homeowners have stopped making mortgage payments and opted to "walk away" from their loans and their homes. The practice has grown so common that the mortgage finance giant Fannie Mae, reeling from mounting losses, is now suing so-called "strategic defaulters" -- those who can afford a mortgage but bail anyway.
You can read the full Pew Research Center study here.
You may have heard that a “strategic default” can be an appropriate
and even beneficial reaction to an upside-down mortgage or impending
foreclosure. As reported, this idea is widespread, but the truth is that default is
never an easy road to choose, and rarely ever strategic. However, you might consider a strategic short sale.
Unfortunately, the ramifications of a “strategic default” are rarely
explained, leaving many homeowners stranded on an island of
Personally I have no moral judgment about
strategic defaults, so you won't face that with me. I do want you to
know all your options. There aren’t many reasons to simply walk away.
There are lots of
short sale options and programs., and you do NOT have to be behind in
your mortgage to do a short sale.
Download your free report outlining the myths and misrepresentations of strategic defaults.
|This site, Richard H. Zwick, Zwick Realty Group & Sand Dollar Realty are not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax adviser for more information.|