Why not walk away?

[Anonymous]

“Why not walk?”
That is a very good question. It probably makes the most sense to move on after consulting with a R/E attorney, a financial advisor and a CPA to review the options and consequences. A financial advisor would probably call you a fool if you stayed. The old school mentality of paying your debts goes out the window when your talking about hundreds of thousands of dollars. This isn’t about paying back your friend that loaned you $2500.

We are only in the 1st or 2nd inning of the mortgage mess. He says he could save $36k a year by walking away and renting. He says he is already 10-20% underwater. Does anyone really think that the values are only going to go a little bit lower? The ARM resets haven’t really hit yet and the Option ARM loans haven’t exploded yet. The Govt. is trying to get a freeze on ARM loans. That isn’t going to work for the people in the Option ARM loans. The majority of the people in those loans can only afford the minimum payment of 1.25%. The losses for people in Option ARM’s is going to be STAGGERING and southern CA is the hotbed for that product. 98% of borrowers were using the Option ARM as an affordibility tool when it was intended to be used as an investment tool. What’s crazy is that the majority don’t understand the loan they are in.

The facts:
He bought in 2003 before the really stupid loans(no doc 100%, 100% with no reserves, 100% with low ficos, Option Arm 1st’s with a 100% CLTV, etc) became all the rage. Was he supposed to know that Wall Street would completely lose their mind??

He put $100k down. Even though it looks some or all of it was from the profit of the previous house, $100k is $100k. He didn’t do 100% financing.

He has a 10 year fixed loan with an I/O option. He didn’t use an Option ARM loan like MANY people did so they could afford to temporarily own a home.

To me, it looks like this guy’s bed was made for him by others(wall street and neighbors). Many people have made their own bed by taking out stupid loans that they can’t afford or by repeatedly pulling out the equity from their home due to appreciation.

Very few people realize that these are the types of people that are going to get snared in this mess. Just because they put money down and don’t have a fantasy loan(option ARM) doesn’t mean they won’t be impacted. If your neighbors purchased between 2003-2007, watch out. If they used an option ARM, ask them where they are going to go after the foreclosure and don’t lend them your tools.

[NateK]

WOW!!!! Am I the only one that noticed that this guy is on the verge of being underwater after paying 100K downpayment plus purchasing in 2003. Holy Crap!!!! Is that like a 60% price decline from the peak??? DAMN!!! Wonder what this downturn is going to be like when it actually catches full momentum.

[NateK]

WOW!!!! Am I the only one that noticed that this guy is on the verge of being underwater after paying 100K downpayment plus purchasing in 2003. Holy Crap!!!! Is that like a 60% price decline from the peak??? DAMN!!! Wonder what this downturn is going to be like when it actually catches full momentum.

[NateK]

WOW!!!! Am I the only one that noticed that this guy is on the verge of being underwater after paying 100K downpayment plus purchasing in 2003. Holy Crap!!!! Is that like a 60% price decline from the peak??? DAMN!!! Wonder what this downturn is going to be like when it actually catches full momentum.

[NateK]

WOW!!!! Am I the only one that noticed that this guy is on the verge of being underwater after paying 100K downpayment plus purchasing in 2003. Holy Crap!!!! Is that like a 60% price decline from the peak??? DAMN!!! Wonder what this downturn is going to be like when it actually catches full momentum.

[NateK]

WOW!!!! Am I the only one that noticed that this guy is on the verge of being underwater after paying 100K downpayment plus purchasing in 2003. Holy Crap!!!! Is that like a 60% price decline from the peak??? DAMN!!! Wonder what this downturn is going to be like when it actually catches full momentum.

[CBad]

Something tells me you weren’t complaining that you had so much equity when your place was worth more than you paid. The tables have turned and NOW it’s a problem for you. You can afford your place no problem but you’re just whining at your ‘misfortune’. Cry me a river.

[CBad]

Something tells me you weren’t complaining that you had so much equity when your place was worth more than you paid. The tables have turned and NOW it’s a problem for you. You can afford your place no problem but you’re just whining at your ‘misfortune’. Cry me a river.

[CBad]

Something tells me you weren’t complaining that you had so much equity when your place was worth more than you paid. The tables have turned and NOW it’s a problem for you. You can afford your place no problem but you’re just whining at your ‘misfortune’. Cry me a river.

[CBad]

Something tells me you weren’t complaining that you had so much equity when your place was worth more than you paid. The tables have turned and NOW it’s a problem for you. You can afford your place no problem but you’re just whining at your ‘misfortune’. Cry me a river.

[CBad]

Something tells me you weren’t complaining that you had so much equity when your place was worth more than you paid. The tables have turned and NOW it’s a problem for you. You can afford your place no problem but you’re just whining at your ‘misfortune’. Cry me a river.

[stockstradr]

“No, you’re suffering because YOU, yourself made a bad choice. Don’t blame it on other people. You didn’t have to sign on the dotted line. You have a brain just like everyone else. You bought in an overinflated market, you should have known the risk.”

I absolutely agree with the member who posted that response, AND I do NOT agree with other member who claimed that post was overly harsh.

Now, to the original poster who asked “should I walk away?” my answer is that YES I would walk away if I was in your shoes. You do it because you can get away with it; additionally, it makes financial sense, and it is legal. Now it may not be a mark of good character, but who gives a shit. Cut your losses and run like the wind.

[stockstradr]

“No, you’re suffering because YOU, yourself made a bad choice. Don’t blame it on other people. You didn’t have to sign on the dotted line. You have a brain just like everyone else. You bought in an overinflated market, you should have known the risk.”

I absolutely agree with the member who posted that response, AND I do NOT agree with other member who claimed that post was overly harsh.

Now, to the original poster who asked “should I walk away?” my answer is that YES I would walk away if I was in your shoes. You do it because you can get away with it; additionally, it makes financial sense, and it is legal. Now it may not be a mark of good character, but who gives a shit. Cut your losses and run like the wind.

[stockstradr]

“No, you’re suffering because YOU, yourself made a bad choice. Don’t blame it on other people. You didn’t have to sign on the dotted line. You have a brain just like everyone else. You bought in an overinflated market, you should have known the risk.”

I absolutely agree with the member who posted that response, AND I do NOT agree with other member who claimed that post was overly harsh.

Now, to the original poster who asked “should I walk away?” my answer is that YES I would walk away if I was in your shoes. You do it because you can get away with it; additionally, it makes financial sense, and it is legal. Now it may not be a mark of good character, but who gives a shit. Cut your losses and run like the wind.

[stockstradr]

“No, you’re suffering because YOU, yourself made a bad choice. Don’t blame it on other people. You didn’t have to sign on the dotted line. You have a brain just like everyone else. You bought in an overinflated market, you should have known the risk.”

I absolutely agree with the member who posted that response, AND I do NOT agree with other member who claimed that post was overly harsh.

Now, to the original poster who asked “should I walk away?” my answer is that YES I would walk away if I was in your shoes. You do it because you can get away with it; additionally, it makes financial sense, and it is legal. Now it may not be a mark of good character, but who gives a shit. Cut your losses and run like the wind.

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