[quote=UCGal]Here’s an example of someone who bought long enough ago that it was probably a traditional loan. (vs stated income) In fact, it should be mostly paid off. But it was foreclosed today.
Somewhere along they way they pulled out an additional $390k (on top of their original loan.)
Amount owed: $582,589.15
Back to the bank today when no one would pay $350k at the steps.
Never put it up for short sale. No sign they did anything other than pull cash out then ride the free-rent program.
This is the type of borrower that I have NO sympathy for.[/quote]
Good example, UCGal. I see a LOT of these, too. In most cases I come into contact with, the owner(s) have literally been LIVING off their home all these years so saw no need to live a productive life, i.e. WORK.
What I don’t understand is WHY these types are being cut breaks (2nd/3rd signing off or “taking it in the shorts” on short-sales and 1st TD lenders willing to “modify” in some cases).
Why would these types CARE about the hit to their credit?? In the example you gave (very typical, btw) the borrowers couldn’t have made that $390K (plus the additional $24K++ deferred interest and trustees fees in the form of “free rent”) to save their souls between the time they first availed themselves of their handy ATM abode and now, when they’re FINALLY going to have to move . . . that is, unless their lender decides to rent back to them, lol.
Then we see these REO’s that have been stripped after all the free “rent” the borrowers received. Where are these borrowers who stripped their property on the eve of eviction and fled with fixtures storing them?? IMHO, the “ATM-to-death and then squat-as-long-as-possible” M.O. is nothing but calculated, deliberate theft on the part of the borrower and we’re all paying for it.
Lenders are TOTALLY to blame for this mess, on BOTH ends.
Let me ask Piggs this. If you could get $390K++ in cash and free rent for perhaps more than a year, would YOU MIND too much if your FICO score plunged from 720 to 420 for a few years??
In other words, is being paid at least $400K in cash and benefits WORTH the hit to your FICO score?
