Will honest people start doing dirty/crooked things to bail out of their houses

[seattle-relo]

Are you wondering what happens to the new house? If the people did have non-recourse loans, can the bank from the repo try to sue them anyway for fraud and try to take the new house? I beat if people can get away with it, they would do it. If they can get into a new home with a lower payment, I think they’d do it.

[seattle-relo]

Are you wondering what happens to the new house? If the people did have non-recourse loans, can the bank from the repo try to sue them anyway for fraud and try to take the new house? I beat if people can get away with it, they would do it. If they can get into a new home with a lower payment, I think they’d do it.

[oxfordrick]

And your credit will be reinstated…..

just in time to catch the next wave!

[oxfordrick]

And your credit will be reinstated…..

just in time to catch the next wave!

[gn]

I think that the “stigma” associated with foreclosure will greatly decrease in the next few years. That’s because foreclosures will become so common.

Most people will simply think:

I was a victim of greedy mortgage brokers/the artificial high prices of the real estate bubble. Look around, there are thousand of other victims. I’m not the only one. So, it’s OK to walk & let the lender foreclose.

[gn]

I think that the “stigma” associated with foreclosure will greatly decrease in the next few years. That’s because foreclosures will become so common.

Most people will simply think:

I was a victim of greedy mortgage brokers/the artificial high prices of the real estate bubble. Look around, there are thousand of other victims. I’m not the only one. So, it’s OK to walk & let the lender foreclose.

[patientlywaiting]

Fraud is an interesting aspect of this whole drama.

A lot of borrowers obtained loans through fraud (overstating income, primary residence instead of investment purchase, etc..) If the banks do some research and can uncover fraud then all bets are off. I would think that the non-recourse aspects of the mortgages are voidable because of fraud (which is also a criminal offense punishable by jail time, if the DA decides to prosecute).

Personally, I think we (as a society) should put more resources to prosecuting the white collar criminals. It doesn’t seem fair that the uneducated criminals get stiff sentences while the smart people who cook up complex scheme go unscathed.

[patientlywaiting]

Fraud is an interesting aspect of this whole drama.

A lot of borrowers obtained loans through fraud (overstating income, primary residence instead of investment purchase, etc..) If the banks do some research and can uncover fraud then all bets are off. I would think that the non-recourse aspects of the mortgages are voidable because of fraud (which is also a criminal offense punishable by jail time, if the DA decides to prosecute).

Personally, I think we (as a society) should put more resources to prosecuting the white collar criminals. It doesn’t seem fair that the uneducated criminals get stiff sentences while the smart people who cook up complex scheme go unscathed.

[djrobsd]

There’s only one hole in your plan. How are they going to get a mortgage on the second property when they still have the mortgage on the first one? The bank is going to see the other mortgage, and decline the loan, unless they have enough debt to income ratio to support paying BOTH mortgages, or they have 20% to put down on the second property and declare it as an investment property. It seems to me though that the bank would look long and hard at your first property before loaning you money on another one…. At least I would!

[djrobsd]

There’s only one hole in your plan. How are they going to get a mortgage on the second property when they still have the mortgage on the first one? The bank is going to see the other mortgage, and decline the loan, unless they have enough debt to income ratio to support paying BOTH mortgages, or they have 20% to put down on the second property and declare it as an investment property. It seems to me though that the bank would look long and hard at your first property before loaning you money on another one…. At least I would!

[seattle-relo]

I am sure that there are some people who do have enough savings for 20% down and could declare the second property as a rental, then move in the “rental” and let the old house foreclose. I think my husband worked with someone who did that back in the 90’s. I think they did because they had to relocate to Chicago for work and couldn’t sell their CA property.

[seattle-relo]

I am sure that there are some people who do have enough savings for 20% down and could declare the second property as a rental, then move in the “rental” and let the old house foreclose. I think my husband worked with someone who did that back in the 90’s. I think they did because they had to relocate to Chicago for work and couldn’t sell their CA property.

[seattle-relo]

I am sure that there are some people who do have enough savings for 20% down and could declare the second property as a rental, then move in the “rental” and let the old house foreclose. I think my husband worked with someone who did that back in the 90’s. I think they did because they had to relocate to Chicago for work and couldn’t sell their CA property.

[seattle-relo]

I am sure that there are some people who do have enough savings for 20% down and could declare the second property as a rental, then move in the “rental” and let the old house foreclose. I think my husband worked with someone who did that back in the 90’s. I think they did because they had to relocate to Chicago for work and couldn’t sell their CA property.

[patientlywaiting]

Very easy to get another purchase mortgage. Just tell the lender you are in the process of selling the old house so it won’t be a liability anymore.

That’s how people normally obtain loans when they move up. The lender then ignore the current mortgage in the underwriting process.

[Author]

Posts