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NotCranky.
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March 17, 2010 at 5:23 PM #527882March 17, 2010 at 7:27 PM #527008
peterb
ParticipantHey, it’s a collateralized loan. So no one gets hurt, right? Borrower doesnt pay, lender takes the collateral. It’s all good.
March 17, 2010 at 7:27 PM #527141ParticipantHey, it’s a collateralized loan. So no one gets hurt, right? Borrower doesnt pay, lender takes the collateral. It’s all good.
March 17, 2010 at 7:27 PM #527588ParticipantHey, it’s a collateralized loan. So no one gets hurt, right? Borrower doesnt pay, lender takes the collateral. It’s all good.
March 17, 2010 at 7:27 PM #527685ParticipantHey, it’s a collateralized loan. So no one gets hurt, right? Borrower doesnt pay, lender takes the collateral. It’s all good.
March 17, 2010 at 7:27 PM #527944ParticipantHey, it’s a collateralized loan. So no one gets hurt, right? Borrower doesnt pay, lender takes the collateral. It’s all good.
March 17, 2010 at 7:52 PM #527013CA renter
ParticipantOkay, the most hillarious part about the “walkaway explosion” is that so many people didn’t see it coming.
Giving people mortgages in a surging market with **NO DOWNPAYMENT** is like giving out free call options on housing…that pay a dividend (cash-out and HELOCs allowed if prices rise). Who in their right mind wouldn’t take that offer? Add to this the fact that nobody even had to qualify in any way — everyone was eligible, including dead people and dogs (true stories). There is no downside, as you can just walk away if the bet doesn’t go your way. The borrower has nothing to lose, and everything to gain.
Housing was marketed as an investment (let’s be honest and call it a gamble) to everyone, so why would anyone feel morally obligated to do anything that goes against their best interests (staying in a house and dutifully making payments when you **lose NOTHING** if you walk away). These people never had any skin in the game. Quite the opposite; they cashed out other people’s money on a bet they didn’t even have to pay for. Brilliant! And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
Want to know the funniest part? They are doing it all over again with the $8,000 tax credit and 3.5% FHA loans (and other low-down mortgages).
(copied from my response to the same article on JtR’s blog)
March 17, 2010 at 7:52 PM #527146ParticipantOkay, the most hillarious part about the “walkaway explosion” is that so many people didn’t see it coming.
Giving people mortgages in a surging market with **NO DOWNPAYMENT** is like giving out free call options on housing…that pay a dividend (cash-out and HELOCs allowed if prices rise). Who in their right mind wouldn’t take that offer? Add to this the fact that nobody even had to qualify in any way — everyone was eligible, including dead people and dogs (true stories). There is no downside, as you can just walk away if the bet doesn’t go your way. The borrower has nothing to lose, and everything to gain.
Housing was marketed as an investment (let’s be honest and call it a gamble) to everyone, so why would anyone feel morally obligated to do anything that goes against their best interests (staying in a house and dutifully making payments when you **lose NOTHING** if you walk away). These people never had any skin in the game. Quite the opposite; they cashed out other people’s money on a bet they didn’t even have to pay for. Brilliant! And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
Want to know the funniest part? They are doing it all over again with the $8,000 tax credit and 3.5% FHA loans (and other low-down mortgages).
(copied from my response to the same article on JtR’s blog)
March 17, 2010 at 7:52 PM #527593ParticipantOkay, the most hillarious part about the “walkaway explosion” is that so many people didn’t see it coming.
Giving people mortgages in a surging market with **NO DOWNPAYMENT** is like giving out free call options on housing…that pay a dividend (cash-out and HELOCs allowed if prices rise). Who in their right mind wouldn’t take that offer? Add to this the fact that nobody even had to qualify in any way — everyone was eligible, including dead people and dogs (true stories). There is no downside, as you can just walk away if the bet doesn’t go your way. The borrower has nothing to lose, and everything to gain.
Housing was marketed as an investment (let’s be honest and call it a gamble) to everyone, so why would anyone feel morally obligated to do anything that goes against their best interests (staying in a house and dutifully making payments when you **lose NOTHING** if you walk away). These people never had any skin in the game. Quite the opposite; they cashed out other people’s money on a bet they didn’t even have to pay for. Brilliant! And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
Want to know the funniest part? They are doing it all over again with the $8,000 tax credit and 3.5% FHA loans (and other low-down mortgages).
(copied from my response to the same article on JtR’s blog)
March 17, 2010 at 7:52 PM #527690ParticipantOkay, the most hillarious part about the “walkaway explosion” is that so many people didn’t see it coming.
Giving people mortgages in a surging market with **NO DOWNPAYMENT** is like giving out free call options on housing…that pay a dividend (cash-out and HELOCs allowed if prices rise). Who in their right mind wouldn’t take that offer? Add to this the fact that nobody even had to qualify in any way — everyone was eligible, including dead people and dogs (true stories). There is no downside, as you can just walk away if the bet doesn’t go your way. The borrower has nothing to lose, and everything to gain.
Housing was marketed as an investment (let’s be honest and call it a gamble) to everyone, so why would anyone feel morally obligated to do anything that goes against their best interests (staying in a house and dutifully making payments when you **lose NOTHING** if you walk away). These people never had any skin in the game. Quite the opposite; they cashed out other people’s money on a bet they didn’t even have to pay for. Brilliant! And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
Want to know the funniest part? They are doing it all over again with the $8,000 tax credit and 3.5% FHA loans (and other low-down mortgages).
(copied from my response to the same article on JtR’s blog)
March 17, 2010 at 7:52 PM #527949ParticipantOkay, the most hillarious part about the “walkaway explosion” is that so many people didn’t see it coming.
Giving people mortgages in a surging market with **NO DOWNPAYMENT** is like giving out free call options on housing…that pay a dividend (cash-out and HELOCs allowed if prices rise). Who in their right mind wouldn’t take that offer? Add to this the fact that nobody even had to qualify in any way — everyone was eligible, including dead people and dogs (true stories). There is no downside, as you can just walk away if the bet doesn’t go your way. The borrower has nothing to lose, and everything to gain.
Housing was marketed as an investment (let’s be honest and call it a gamble) to everyone, so why would anyone feel morally obligated to do anything that goes against their best interests (staying in a house and dutifully making payments when you **lose NOTHING** if you walk away). These people never had any skin in the game. Quite the opposite; they cashed out other people’s money on a bet they didn’t even have to pay for. Brilliant! And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
Want to know the funniest part? They are doing it all over again with the $8,000 tax credit and 3.5% FHA loans (and other low-down mortgages).
(copied from my response to the same article on JtR’s blog)
March 17, 2010 at 8:04 PM #527018Arraya
Participant[quote=CA renter] And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
[/quote]Actually, it’s the opposite.
People are acting against their own economic self-interest by continuing to pay off houses where they may not have any equity for decades,” he said. “They’re throwing away good money after bad.”
Shame, guilt and fear stop many homeowners from reneging on their mortgages, he said. The government and big banks actively cultivate those emotional constraints because the economic consequences of a large-scale walkaway phenomenon could be dire, he said.
Strategic defaults have widespread repercussions. Ongoing foreclosures destabilize the housing market because the homes are sold at bargain prices. They also undermine the entire economy because banks must eat huge losses and homeowners rein in spending as their own homes lose value. Empty homes hurt neighborhoods and attract blight. And walkaways may inspire copycats – people who’ve seen their neighbors deliberately default feel more emboldened to do so themselves.
California is a nonrecourse state, where lenders cannot pursue homeowners for the unpaid balance on their first mortgage.Read more: http://www.sfgate.com/cgi-bin/article.cg…
March 17, 2010 at 8:04 PM #527151Participant[quote=CA renter] And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
[/quote]Actually, it’s the opposite.
People are acting against their own economic self-interest by continuing to pay off houses where they may not have any equity for decades,” he said. “They’re throwing away good money after bad.”
Shame, guilt and fear stop many homeowners from reneging on their mortgages, he said. The government and big banks actively cultivate those emotional constraints because the economic consequences of a large-scale walkaway phenomenon could be dire, he said.
Strategic defaults have widespread repercussions. Ongoing foreclosures destabilize the housing market because the homes are sold at bargain prices. They also undermine the entire economy because banks must eat huge losses and homeowners rein in spending as their own homes lose value. Empty homes hurt neighborhoods and attract blight. And walkaways may inspire copycats – people who’ve seen their neighbors deliberately default feel more emboldened to do so themselves.
California is a nonrecourse state, where lenders cannot pursue homeowners for the unpaid balance on their first mortgage.Read more: http://www.sfgate.com/cgi-bin/article.cg…
March 17, 2010 at 8:04 PM #527598Participant[quote=CA renter] And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
[/quote]Actually, it’s the opposite.
People are acting against their own economic self-interest by continuing to pay off houses where they may not have any equity for decades,” he said. “They’re throwing away good money after bad.”
Shame, guilt and fear stop many homeowners from reneging on their mortgages, he said. The government and big banks actively cultivate those emotional constraints because the economic consequences of a large-scale walkaway phenomenon could be dire, he said.
Strategic defaults have widespread repercussions. Ongoing foreclosures destabilize the housing market because the homes are sold at bargain prices. They also undermine the entire economy because banks must eat huge losses and homeowners rein in spending as their own homes lose value. Empty homes hurt neighborhoods and attract blight. And walkaways may inspire copycats – people who’ve seen their neighbors deliberately default feel more emboldened to do so themselves.
California is a nonrecourse state, where lenders cannot pursue homeowners for the unpaid balance on their first mortgage.Read more: http://www.sfgate.com/cgi-bin/article.cg…
March 17, 2010 at 8:04 PM #527696Participant[quote=CA renter] And now, the govt is painting them as “victims” so they don’t even have to feel guilty for walking away.
[/quote]Actually, it’s the opposite.
People are acting against their own economic self-interest by continuing to pay off houses where they may not have any equity for decades,” he said. “They’re throwing away good money after bad.”
Shame, guilt and fear stop many homeowners from reneging on their mortgages, he said. The government and big banks actively cultivate those emotional constraints because the economic consequences of a large-scale walkaway phenomenon could be dire, he said.
Strategic defaults have widespread repercussions. Ongoing foreclosures destabilize the housing market because the homes are sold at bargain prices. They also undermine the entire economy because banks must eat huge losses and homeowners rein in spending as their own homes lose value. Empty homes hurt neighborhoods and attract blight. And walkaways may inspire copycats – people who’ve seen their neighbors deliberately default feel more emboldened to do so themselves.
California is a nonrecourse state, where lenders cannot pursue homeowners for the unpaid balance on their first mortgage.Read more: http://www.sfgate.com/cgi-bin/article.cg…
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