[quote=SK in CV] … If it makes you feel better thinking that every buyer knew exactly what they were doing, hold on to that. I’m telling you it’s not necessarily true.[/quote] SK, I KNOW that many borrowers had/have language barriers and didn’t/don’t know what they are signing and have tried to help a couple of them after the fact (unsuccessfully). There is SUPPOSED to be someone in each closing (usually the notary) who explains everything to the buyers in their language. However, this is not the law in CA.
When a prospective borrower applies for a purchase-money mortgage, it is usually before even making an offer on a property. At this point, they’re trying to find out how much they qualify for and also get a pre-approval letter enabling them to make stronger offers. They sign THIS document (the loan application – by itself) LONG before closing. Buyers who don’t understand English well usually use mortgage brokers/banks who speak their language … or have personnel in the office who do.
In the case of the prospective borrower in this thread, he/she apparently had no problem qualifying for a mortgage and was well-qualified for his mtg before, during and after their “strategic default.” They defaulted ONLY because they couldn’t sell and “move up” (to a “better” area) after a relatively short period of homeownership (part of that time encompassing the downturn).
The OP here NEVER STATED that he “didn’t know what he was signing” or “got ripped off by his mtg banker/broker.” He only stated he didn’t want to own his house anymore and so “strategic default” was his perceived way out of it.
