FWIW, I posted that long tirade because the OP’s “underwater” situation was borderline and I believe he could have eventually recovered had he just refied once in ’04 or ’09 thru ’11 and never took cash out. I am fully cognizant of what prevailing rates and terms were during the era of his homeownership for prime, Alt A and subprime buyers.
He also stated that he intended fully on having and raising kids in that house and planned to stay there ten years. He also stated that he is currently renting in Alpine and wishes to purchase there (for more $$ than he spent in Lakeside) and somehow believes it is a better place to raise his children. That is purely subjective, unproven and based upon his posts, I frankly don’t see the OP qualifying to purchase in the $400-$500K range at this time.
It appeared SMH had to sell short because he himself increased his principal amount over the years by taking cash out and repeatedly refinancing. It also appears he (and his agent) were ignorant of the true values of the area (or got caught up in a “bidding war” or both) and he ended up paying too much for the property, initially (which I now feel may have actually been worth $335-$340K at the time). I fully attribute that huge mistake to agent incompetence, since the OP was a 1st-time buyer.
And no, I don’t know the address of the property SMH purchased.
Piggs, I’m not moralizing here and realize a trust deed is a contract. But if every property owner who could afford to pay their mtg got them successfully “crammed down” to the tune of $124K in a successful “short sale” (with a +/- 3-year “slap on the wrist” to their credit), what does this do to the property values of the owners around them? Why should ANYONE keep their mortgages current if they feel they might be even the least bit underwater and see other, more qualified buyers around them purchasing “bigger, newer” properties for less than they paid??
This “strategic defaulter” mindset is a very slippery slope and has far-reaching ramifications for every owner in their immediate area.
I feel the mess this OP made of his credit didn’t have to happen. It was purely voluntary and I feel he needs to OWN it instead of laying the blame somewhere else. The reasons given for his walking, I feel were weak and had little to do with how much he owed.
We all know that if a group home gets permitted on our block or a registered sex offender moves in on our block AFTER we buy and move in, that there is nothing we can really do about that except move. A homebuyer can’t control everything that goes on with every resident in his/her immediate area or subdivision. This happens in “Del Mar” and all the way down the “housing chain.”
Again, I’m not judging you, personally, SMH, but lumping you in with many others who have the same mindset. I could have understood you walking if you purchased in ’05 thru ’07 for a VERY high price and NEVER refinanced or took cash out. But I have little sympathy for strategic defaulters who purchased PRIOR to the “millenium bubble” and not only took cash out but repeatedly allowed refinancing lenders to bamboozle them into exorbitant points and fees, which in many cases, effectively stole more equity from them than the cash they actually extracted from their equity! I don’t think a very large portion of refinancers are actually doing the math to make sure refi closing costs justify how long they will actually carry the new mortgage.
Even if a serial refinancer never extracted any equity, just the fact that they serially refied every time the prevailing mtg interest rate dropped by a fraction of a point, they allowed more of their equity to be `stolen’ each time through closing costs.
Of course, SMH has stated he realizes this now. There is no free lunch here. Again, thank you for putting your situation out there and opening this interesting discussion amongst the Piggs!
