Thanks for all the feedback. I’ve obviously touched a nerve. I’m glad that others agree this crosses the line. For those who endorse dumping loans and enjoying the free ride, I would argue that even that pushes the envelope of what is acceptable and makes this kind of thinking more common. If one really abides by the contract, shouldn’t you move out of the house as soon as you stop paying your mortgage instead of trying to milk the free ride as long as it will last before someone forces you out? Personally, I liked TG’s ethics summary.
When I heard my friend’s plan and questioned her ethics, I got jumped on by several others in the room who were in a similar situation and also hoping to abandon their mortgages, though hopefully without the vandalism. These days, unethical behavior feels like the newly accepted status quo. Such behavior is emboldened by the lack of consequences that seems inevitable when so many people do the same thing. Reminds me of the looters during the Watts riots.
The other thing that drives this is the seemingly insurmountably large sums involved relative to annual income. It makes people feel like a few years of bad credit is minor relative to the time it would take to pay back the amounts of debt involved. While the piggs saw it coming, most simply couldn’t imagine prices declining so dramatically. 3 yrs ago, many first time home buyers bought a starter condo that they thought they could trade up from in a few years. Now they are stuck with a home they have outgrown and they realize they have made the worst financial decision of their life. They are desperate for a way out. Society, Bush then Obama, whoever, now says it’s okay to foreclose and we’ll help you through it. The removal of consequences is interpreted by many as an implicit endorsement of what was once unacceptable behavior.
Despite all this, I can accept that there may be extreme cases where such genuine hardship is encountered that society is right to show compassion and even clemency. However, current policies are way too broad and far too easily abused.
