[quote=sdrealtor]Was having a conversation with an attorney today and here is the problem with walking away. Whether it is legal, moral, ethical or whatever it can come back to haunt you in the future.
If you are an attorney, someone who needs a security clearance, someone who works in the financial industry, someone who will handle finances for a company, someone who holds a position of trust or many other careers a foreclosure will show up on your credit report and there are 20 year reports that can be pulled.
No matter how you view it, try explaining to the HR rep what a “stand-up” guy or gal you are when this is on your record. No matter how good you can position it, would you expect to be viewed in the same light as an equally “stand-up” guy or gal who doesnt have that mark on their credit report?
There are no guarantees and it can easily amount to career suicide. I cant imagine anyone walking away and expecting it to be a free pass forever. Sooner or later it can easily come back and bite them on the ass in a way far more damaging than being underwater.[/quote]
Your post reflects what I’ve been wondering, sdr. Even prior to the bust, employers were running credit checks on prospective employees; it’s a cinch that they’re doing so now. Even in cases of foreclosure where the borrower simply ran out of funds to pay the mortgage, employers are using that as an excuse not to hire someone. I can’t imagine how someone who walks away from a mortgage obligation when he/she is not in any financial distress will circumvent the credit report and manage to procure a security clearance or job offer. In addition, I can’t see the moneylenders sitting by and not taking action on walk-away borrowers; hell, they screwed us royally when they were fat, happy, and making money hand over fist during the first 6 or 7 years of this decade, and it’s a fairly good bet that the events of the last couple years haven’t caused them to re-examine their motives and practices, and put a kindler, gentler loan default policy into place.
No, I think that borrowers who walk away from properties for which they can continue to make payments are risking a lifelong “deadbeat” reputation that not only will make it impossible for them to gain credit, but also bar them from security clearances, attractive employment offers, and other opportunities. To paraphrase Captain Renault in Casablanca: “I’m afraid that the bankers will insist”.
Note that I am not commenting on the decision to stay or walk away. As made very evident on this thread, that’s a very personal choice based on individual viewpoint. But the thought of what the extremely powerful lending community will do to those who do walk scares the hell out of me. And anyone who thinks that the government will step in and prevent them from taking draconian measures need only look at congressional and agency response to banking missteps over the past 25 years.
