Five years after the housing bubble burst, America’s wealthiest families are now losing their homes to foreclosure at a faster rate than the rest of the country — and many of them are doing so voluntarily.
But with a recovery in the housing market still years away, foreclosure has turned out to be a worthwhile option after all. Saddled with bloated mortgages after a long run up in property values, many high-end homeowners have chosen to pursue a “strategic default.” Even though they can afford the monthly mortgage payments, they still decide to walk away from their home because they owe more on the property than it is worth.[/quote]
Arraya, I am hoping the IRS will bring back the requirement for issuing Form 1098 to reflect the amount of lender loss (upon resale of an REO) as “phantom income” to ALL defaulters beginning 2013. Since a good portion of them now appear to be the “well-employed” and “rich” “strategic defaulter,” they can think twice if they really want to be on the hook for income taxes on their lender’s losses of $300K+ incurred upon resale (as a direct result of the cash they already extracted from the property).
