Forum Replies Created
-
AuthorPosts
-
savedbypigs
Participant“I personally would be the first person to continue to pay my mortgage even if there was a way out during a huge value drop, why? Because that is the agreement I made at the time for a 30 yr commitment.”
Perhaps this is the distinction being missed by the morality folks. The agreement you made was NOT that you would pay for 30 years. The agreement you made was that you would pay for 30 years, OR you would return the property, your option.
Participant“I personally would be the first person to continue to pay my mortgage even if there was a way out during a huge value drop, why? Because that is the agreement I made at the time for a 30 yr commitment.”
Perhaps this is the distinction being missed by the morality folks. The agreement you made was NOT that you would pay for 30 years. The agreement you made was that you would pay for 30 years, OR you would return the property, your option.
Participant“I personally would be the first person to continue to pay my mortgage even if there was a way out during a huge value drop, why? Because that is the agreement I made at the time for a 30 yr commitment.”
Perhaps this is the distinction being missed by the morality folks. The agreement you made was NOT that you would pay for 30 years. The agreement you made was that you would pay for 30 years, OR you would return the property, your option.
Participant“I personally would be the first person to continue to pay my mortgage even if there was a way out during a huge value drop, why? Because that is the agreement I made at the time for a 30 yr commitment.”
Perhaps this is the distinction being missed by the morality folks. The agreement you made was NOT that you would pay for 30 years. The agreement you made was that you would pay for 30 years, OR you would return the property, your option.
ParticipantSD, I meant no offense. All I am saying is, from a legal standpoint at least, the responsibility for the bad line of code has been placed in the hands of the lender. So I don’t think it’s fair to impose perceived moral or ethical obligations upon people that did not assume them in the first instance.
If we want to change the nature of home loans in the future, that is a proposition I haven’t fully considered, although I’m not really sure that $50,000 income Joe with the $600,000 loan would really have cared if the loan was recourse or nonrecourse because he presumably has no assets. Sensible Sheila, who can afford the loan, would obviously have cared, but isn’t our current state of affairs more the result of the Joes, and not the Sheilas? And is it really too much to ask that lenders get a clue before they start throwing their money around in the expectation of repayment?
ParticipantSD, I meant no offense. All I am saying is, from a legal standpoint at least, the responsibility for the bad line of code has been placed in the hands of the lender. So I don’t think it’s fair to impose perceived moral or ethical obligations upon people that did not assume them in the first instance.
If we want to change the nature of home loans in the future, that is a proposition I haven’t fully considered, although I’m not really sure that $50,000 income Joe with the $600,000 loan would really have cared if the loan was recourse or nonrecourse because he presumably has no assets. Sensible Sheila, who can afford the loan, would obviously have cared, but isn’t our current state of affairs more the result of the Joes, and not the Sheilas? And is it really too much to ask that lenders get a clue before they start throwing their money around in the expectation of repayment?
ParticipantSD, I meant no offense. All I am saying is, from a legal standpoint at least, the responsibility for the bad line of code has been placed in the hands of the lender. So I don’t think it’s fair to impose perceived moral or ethical obligations upon people that did not assume them in the first instance.
If we want to change the nature of home loans in the future, that is a proposition I haven’t fully considered, although I’m not really sure that $50,000 income Joe with the $600,000 loan would really have cared if the loan was recourse or nonrecourse because he presumably has no assets. Sensible Sheila, who can afford the loan, would obviously have cared, but isn’t our current state of affairs more the result of the Joes, and not the Sheilas? And is it really too much to ask that lenders get a clue before they start throwing their money around in the expectation of repayment?
ParticipantSD, I meant no offense. All I am saying is, from a legal standpoint at least, the responsibility for the bad line of code has been placed in the hands of the lender. So I don’t think it’s fair to impose perceived moral or ethical obligations upon people that did not assume them in the first instance.
If we want to change the nature of home loans in the future, that is a proposition I haven’t fully considered, although I’m not really sure that $50,000 income Joe with the $600,000 loan would really have cared if the loan was recourse or nonrecourse because he presumably has no assets. Sensible Sheila, who can afford the loan, would obviously have cared, but isn’t our current state of affairs more the result of the Joes, and not the Sheilas? And is it really too much to ask that lenders get a clue before they start throwing their money around in the expectation of repayment?
ParticipantSD, I meant no offense. All I am saying is, from a legal standpoint at least, the responsibility for the bad line of code has been placed in the hands of the lender. So I don’t think it’s fair to impose perceived moral or ethical obligations upon people that did not assume them in the first instance.
If we want to change the nature of home loans in the future, that is a proposition I haven’t fully considered, although I’m not really sure that $50,000 income Joe with the $600,000 loan would really have cared if the loan was recourse or nonrecourse because he presumably has no assets. Sensible Sheila, who can afford the loan, would obviously have cared, but isn’t our current state of affairs more the result of the Joes, and not the Sheilas? And is it really too much to ask that lenders get a clue before they start throwing their money around in the expectation of repayment?
ParticipantI agree with Bobby and Patiently, and disagree that the “intent” of a nonrecourse loan is to provide the buyer an out only in the event of hardship or catastrophic event. Legally, a nonrecourse loan provides the debtor the choice of either paying off the debt or forfeiting the property. Thus, at all times, a nonrecourse transaction provides the obligor the option to return the property to the creditor in total satisfaction of the obligation. This is not an amorphous concept that applies only in certain circumstances, nor is it any secret in the banking/mortgage industry.
Thus, in a nonrecourse situation, it is entirely incumbent upon the creditor to ensure that the collateral protecting the obligation is sufficient. While it certainly may be foolhardy to purchase property beyond one’s means, from a legal perspective the sole responsibility for loss falls upon the party loaning money without adequate security. The person walking away from a nonrecourse loan that has gone upside down is merely exercising his/her legal rights under the contract.
ParticipantI agree with Bobby and Patiently, and disagree that the “intent” of a nonrecourse loan is to provide the buyer an out only in the event of hardship or catastrophic event. Legally, a nonrecourse loan provides the debtor the choice of either paying off the debt or forfeiting the property. Thus, at all times, a nonrecourse transaction provides the obligor the option to return the property to the creditor in total satisfaction of the obligation. This is not an amorphous concept that applies only in certain circumstances, nor is it any secret in the banking/mortgage industry.
Thus, in a nonrecourse situation, it is entirely incumbent upon the creditor to ensure that the collateral protecting the obligation is sufficient. While it certainly may be foolhardy to purchase property beyond one’s means, from a legal perspective the sole responsibility for loss falls upon the party loaning money without adequate security. The person walking away from a nonrecourse loan that has gone upside down is merely exercising his/her legal rights under the contract.
ParticipantI agree with Bobby and Patiently, and disagree that the “intent” of a nonrecourse loan is to provide the buyer an out only in the event of hardship or catastrophic event. Legally, a nonrecourse loan provides the debtor the choice of either paying off the debt or forfeiting the property. Thus, at all times, a nonrecourse transaction provides the obligor the option to return the property to the creditor in total satisfaction of the obligation. This is not an amorphous concept that applies only in certain circumstances, nor is it any secret in the banking/mortgage industry.
Thus, in a nonrecourse situation, it is entirely incumbent upon the creditor to ensure that the collateral protecting the obligation is sufficient. While it certainly may be foolhardy to purchase property beyond one’s means, from a legal perspective the sole responsibility for loss falls upon the party loaning money without adequate security. The person walking away from a nonrecourse loan that has gone upside down is merely exercising his/her legal rights under the contract.
ParticipantI agree with Bobby and Patiently, and disagree that the “intent” of a nonrecourse loan is to provide the buyer an out only in the event of hardship or catastrophic event. Legally, a nonrecourse loan provides the debtor the choice of either paying off the debt or forfeiting the property. Thus, at all times, a nonrecourse transaction provides the obligor the option to return the property to the creditor in total satisfaction of the obligation. This is not an amorphous concept that applies only in certain circumstances, nor is it any secret in the banking/mortgage industry.
Thus, in a nonrecourse situation, it is entirely incumbent upon the creditor to ensure that the collateral protecting the obligation is sufficient. While it certainly may be foolhardy to purchase property beyond one’s means, from a legal perspective the sole responsibility for loss falls upon the party loaning money without adequate security. The person walking away from a nonrecourse loan that has gone upside down is merely exercising his/her legal rights under the contract.
ParticipantI agree with Bobby and Patiently, and disagree that the “intent” of a nonrecourse loan is to provide the buyer an out only in the event of hardship or catastrophic event. Legally, a nonrecourse loan provides the debtor the choice of either paying off the debt or forfeiting the property. Thus, at all times, a nonrecourse transaction provides the obligor the option to return the property to the creditor in total satisfaction of the obligation. This is not an amorphous concept that applies only in certain circumstances, nor is it any secret in the banking/mortgage industry.
Thus, in a nonrecourse situation, it is entirely incumbent upon the creditor to ensure that the collateral protecting the obligation is sufficient. While it certainly may be foolhardy to purchase property beyond one’s means, from a legal perspective the sole responsibility for loss falls upon the party loaning money without adequate security. The person walking away from a nonrecourse loan that has gone upside down is merely exercising his/her legal rights under the contract.
-
AuthorPosts