USA I'm walking from my underwater mortgage

The debt is asset backed. The lender agreed that the asset was worth the debt.

The lender gets the asset that they valued. They have also had interest on the asset for a period of years.

Who has lost anything?

The lender?

Then they should have been on top of their lending game, and properly set up the loan terms.

If they hadn't moved off a 20% deposit and maximum of 3x income system . . . .


The lady would still have her home, and she'd have paid a heck of a lot less for it.

The lender more than likely sold on the debt, sliced and diced it into so many different financial and derivative products, that they made anywhere from $1 million to $50 million on the deal, probably sliced and diced it so much, that nobody now would have even a slight chance of getting possession of the properties ownership rights anyway. Yet 'the lady' is the problem?

Yeah right.

I don't understand how anyone can follow the banking fiasco and still feel one iota of sympathy for them.

They're just all too eager to take peoples' homes for being a few payments behind... knowing they've made $$$ in interest plus they are guaranteed the 20% downpayment (PMI) in case of default.

The economy here is so bad, the housing market has suffered greatly. Many seasoned landlords are losing their properties, tenants are losing their homes; and yet, the large banks have no programs for owners of rental properties.

Our local banks, otoh, absolutely know what the market is like and are bending over backwards to work with landlords.

Mixin said:

I don't understand how anyone can follow the banking fiasco and still feel one iota of sympathy for them.

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Out of curiousity, how many bankers do you know that cruise apt. buildings telling occupants they "need" to take out loans and move into homes they can't afford?

The problem lies with the entitlement mentality. People living far beyond their means and on credit. I'm no lover of bankers, but they're offering a service, nothing more.

Somewhere, somehow, folks got it into their minds that they can live up to their necks in debt and everything's fine as long as, __________ (fill in the blank.)

It's about accountability. You're entitled to exactly what you can pay for, not what you can justify "you deserve".




Malone

This woman made a bunch of dumb decisions. First was thinking that she could come out of a divorce living the same life style that she had before the divorce. She bought a four bedroom house instead of renting and seeing how she lands after the dust settles.

Secondly, she said that she had no intention of living there long term. Huh? Which, to me at least, implies that she bought the house as an investment. BIG MISTAKE. Buy the house and make the improvements with the idea of this being shelter, a place to live, rather than "I'm gonna make me a profit here." Too much of the "flip this house" mentality here.

Third, she isn't in debt enough, so she goes out and takes a SECOND mortgage on the property? She couldn't see using any of the second mortgage to make any type of much needed improvements to the property? Even if she used that money to pay down all of her other debt, it was a huge clue that she was living waaay beyond her means.

How does someone who purchased a $100K home with a $1500/mo mortgage still not have the home paid off in 7 years? She should be very close to paying it off. Am I off on this?

We paid $105K for our condo and paid it off in less time and it is now worth $310K. It was worth $420K prior to the crash.

bethshaya said:

How does someone who purchased a $100K home with a $1500/mo mortgage still not have the home paid off in 7 years? She should be very close to paying it off. Am I off on this?

We paid $105K for our condo and paid it off in less time and it is now worth $310K. It was worth $420K prior to the crash.

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You'll notice that the article didn't tell how much this wastrel bitch borrowed at the refi. People are assuming that it was merely the difference between the $100K she paid and the $154K it was later appraised at, but that is not KNOWN. If her credit was good and she had a good paying job, the extra she borrowed might have been far in excess of $54K.

Might make it harder for people to feel sorry for her irresponsible ass, ya' know?

Brutus said:

You'll notice that the article didn't tell how much this wastrel bitch borrowed at the refi. People are assuming that it was merely the difference between the $100K she paid and the $154K it was later appraised at, but that is not KNOWN. If her credit was good and she had a good paying job, the extra she borrowed might have been far in excess of $54K.

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Pretty stupid move on the bank's part lending so much money on such a crappy house. Remember those Ditech ads for lending at 120% of assessed value. That stupidity went on for YEARS. And who is paying for that stupidity? The taxpayers. Each and every one of those banks that made those stupid decisions should fail. Stupid should hurt.

Corporations default on their obligations all the time and reopen for business the next day. It's business and is treated like just another business transaction. Why is a mortgage any different. The mortgage agreement calls for the bank to take the house and the bank takes the house. I'm sure those astute businessmen at the bank were aware this might happen.

If we had allowed ALL these stupid and corrupt banks to fail, we would already be out of this mess. The billions spent on TARP could have help fund hundreds of new banks with clean balance sheets. FDIC could have bailed out the depositors like they have promised all these years. Depositors could have moved to a new safe bank. Instead we are left with the same sorry crooks that got us into this mess in the first place.

Get used to it, Folks, because, soon, we are *all* going to be 'walking away' from it.

Caplock50 said:

Get used to it, Folks, because, soon, we are *all* going to be 'walking away' from it.

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Well, there's plenty of people who paid off, or are nearly there.


Those who did not fall for the siren call of "easy" refinancing money.


Probably the same geniuses who fell for all the quick refi's are now the same bunch demanding that banks make easy credit available.

Fisher said:

I am a single parent with three children, one with medical issues.

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Not that I am defending just walking away, but I can understand... A child with any sort of serious medical issue is enough to suck up every dime you can scrape together, and drive you into bankruptcy. My middle son has a list of medical issues to numerous to even repeat all of them, on top of his emotional and mental issues (we are autism spectrum, with an official diagnoses of aspergers), and medical bills are killing me. Every time I pay off one, I get two or three more bills from dr's, labs, etc.

Caplock50 said:

Get used to it, Folks, because, soon, we are *all* going to be 'walking away' from it.

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Cap, you got that right. The folks who get all red in the face over walkaways and other such "lowlife thieves" are gonna just bust a vein or two before 2010 is over.

Wow. Rough crowd.

Sometimes people's circumstances cause them to make choices others wouldn't.

Whatever. I'm not in her shoes.

But if I were, I might do the same. Who knows?

BigFootsCousin said:

Didn't come outa thin air nor grow on trees ya know?

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Your right it didn't come out of thin air, it came off Federal Reserve printing press that cost almost nothing to produce, and is backed by nothing.

Caplock50 said:

Get used to it, Folks, because, soon, we are *all* going to be 'walking away' from it.

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+100
Its odd to see people getting all judgMENTAL about this and tearing the person apart and in the same breath rail about banks...

By law, the bank is not allowed to put any of their assets at risk by making a loan. And yet repayment of principle and interest is made by people who sweat and toil for the necessary FRNs. And then, because each FRN comes with an implicit lien on anything purchased with the FRN, we do not own it anyway.

The ultimate fraud . . . they create the money from nothing - then they make you work and sweat and toil to pay the debt. And then when you finish paying the debt, you don't own it anyway.

BigFootsCousin said:

Lessee, five bucks stolen versus $154k.....stealin is stealin. Took it and someone lost it. Didn't come outa thin air nor grow on trees ya know?

BFC

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Wrong. The money was absolutely created out of thin air - it is called counterfeiting, and banks do it all the time. By law, the bank is not allowed to put any of its assets at risk in making the loan.

Brutus said:

You'll notice that the article didn't tell how much this wastrel bitch borrowed at the refi. People are assuming that it was merely the difference between the $100K she paid and the $154K it was later appraised at, but that is not KNOWN. If her credit was good and she had a good paying job, the extra she borrowed might have been far in excess of $54K.

Might make it harder for people to feel sorry for her irresponsible ass, ya' know?

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Whatever the amount, the bank agreed to it. They felt the house was worth it. Why aren't you pissed off at the bank for making such a dumbass decision? And YOU are also missing the fact that she made payment for years. It's not as if the bank didn't get a large chunk, probably a HUGE chunk, of its money back. Yes, the principal may not have been paid down much, but how much interest did she pay? Or are we supposed to pretend the interest payments she made didn't go to the bank?

Bankers are greedy sons of bitches, the whole lot of them. They rape us with their interest rates, and people like you pity them when THEY make a bad decision.

Brutus said:

Thank you NC Susan for posting the pic.

Maybe her husband divorced her because she's a fat, ugly bitch.

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Name calling is normally restricted to the kids school playground...grow up.

I suppose you think you're an up and coming Mr America? Remember people don't see you as you see yourself, you could get a shock if you asked around

So Im listening to Rush Limbaugh, AM Radio, discussing money with an accountant who is about to go Gault

She has a young man in with wife and 2 kids and his W2 is 15k for the year. He paid into IRS $142.00 and gets back an earned income of over $7k. He is also entitled to and receiving Section 8 Housing, Medicare, WIC, foodstamps etc. and in reality has a higher disposable income than the accountant.

The accountant has either paid in, or received nothing back for more than ten years, and now, with ObamEconomics and the stiffer tax penalties, is worried about not being able to afford the tax liabilities that come with work!!

I wonder, with no bills, no job, and no home, if the single mom wont come out with more disposable income on the dole than with a mortgage.

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juco said:

According to the article, the woman lost her job. I don't know about you folks, but I'm not sure we could do any different in the same situation. I ain't throwing no stones, my house has too much glass in it.

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BINGO. Everyone's arguing about it, not thinking about the fact that she likely has no funds to continue, even if she wanted to. Lots of people are loosing their homes due to job loss, no matter what they want in the equation, and banks aren't working with them.

That's the position we're in right now. Husband laid off since May of last year and we're working hard to keep our house, despite the mortgage company not working with us. So far, we're still ok and up to date on this mortgage and we aren't behind on any of the bills for our four walls. The debt we owe to the hospital will have to wait until we have more income coming in, until then they just get what we can send them each month, if anything.

jba4241 said:

Whatever the amount, the bank agreed to it. They felt the house was worth it. Why aren't you pissed off at the bank for making such a dumbass decision? And YOU are also missing the fact that she made payment for years. It's not as if the bank didn't get a large chunk, probably a HUGE chunk, of its money back. Yes, the principal may not have been paid down much, but how much interest did she pay? Or are we supposed to pretend the interest payments she made didn't go to the bank?

Bankers are greedy sons of bitches, the whole lot of them. They rape us with their interest rates, and people like you pity them when THEY make a bad decision.

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And she likely has PMI, too, so the bank will get a nice, fat check for the house AND get to keep the house to auction if off as well.

I'm not completely sure I'd call the woman a thief, but the company Youwalkaway.com certainly is. They charge $995 for very little effort and provide a forum for the customers.

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gelatinous said:

I'm not completely sure I'd call the woman a thief, but the company Youwalkaway.com certainly is. They charge $995 for very little effort and provide a forum for the customers.

snip....
http://www.youwalkaway.com/kit.php

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Huh. That's a healthy chunk of change that could have gone towards a house payment.

Just sayin'!

jba4241 said:

Whatever the amount, the bank agreed to it. They felt the house was worth it. Why aren't you pissed off at the bank for making such a dumbass decision? And YOU are also missing the fact that she made payment for years. It's not as if the bank didn't get a large chunk, probably a HUGE chunk, of its money back. Yes, the principal may not have been paid down much, but how much interest did she pay? Or are we supposed to pretend the interest payments she made didn't go to the bank?

Bankers are greedy sons of bitches, the whole lot of them. They rape us with their interest rates, and people like you pity them when THEY make a bad decision.

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Bullshit.

I don't "pity the banks."

I just don't believe in blaming it all on the banks, the way most of the posters to this thread do.

Yeah, the banks did plenty of stupid stuff in all this mess. SO DID THE FOLKS WHO SIGNED UP FOR IT.

There is equal blame to go around, but those who think it's OK to walk away like a sorry bastard are dead wrong. All these "walkers", as I term them, thought they were going to get something for nothing or make a big killing by flipping houses. Now they want to whine when they get caught short and go boo-hooing around about how it's not their fault.

My credit card companies send me stupid enticements in the mail all the time. The difference between me and people like the woman in this story is that I DON'T SIGN UP FOR THOSE STUPID ENTICEMENTS!!!

Obviously, more information in the article would provide for more informed opinions on what her options were and what she did with the refi funds.

Is anyone else wondering how much her alimony and child support payments from the ex are?

I think there is much more to the story that we don't know. It does seem apparent that the woman needs to learn more about personal finances, saving and household budgeting.

GB7

Boo-fricking hoo. She took $$ OUT of it, she caused this problem.
And there is no way thats an all 200 yr old house, thats a pop top if I ever saw one, that top story is an add-on. no wonder its got problems.

I just went back and did a little calculating with an online mortgage calculator.

Assuming zero down, for 15 years, at an interest rate of 6.5%, with a PMI of 0.5%, and a property tax rate of 1.25% (interest, PMI, and prop. tax were the default rates in the calc. since we don't know what hers were), a $100K house could be paid off in 15 years at a tad over $1,000 a month.

For this woman's monthly payment to have been $1,450, she had to have borrowed a BUTT TON of money at the refi., especially considering that she originally bought it in '01 and didn't refi. until '05.

I'd like to know where all the cash went.

Malone Laveigh said:

Out of curiousity, how many bankers do you know that cruise apt. buildings telling occupants they "need" to take out loans and move into homes they can't afford?

The problem lies with the entitlement mentality. People living far beyond their means and on credit. I'm no lover of bankers, but they're offering a service, nothing more.

Somewhere, somehow, folks got it into their minds that they can live up to their necks in debt and everything's fine as long as, __________ (fill in the blank.)

It's about accountability. You're entitled to exactly what you can pay for, not what you can justify "you deserve".

Malone

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I don't know any bankers doing that at the present time. It was only a few years ago, though, it was common practice for real estate agents to publish "Fire your landlord, buy this home!!" ads and their favorite banker waited back at the office with pen in hand. You remember all those "0 downpayment" signs, don't you?

If it weren't for people taking chances and living above their means, many of the businesses you use would be non-existent. It takes a lot of money to start a business and leveraging is how you expand it. sometimes it's profitable and pays for itself; sometimes it fails.

The banks got their bailout and used it to their benefit. Americans are receiving no bailout and are doing what they need to do.

No one should be smug in these times...

Brutus said:

I just went back and did a little calculating with an online mortgage calculator.

Assuming zero down, for 15 years, at an interest rate of 6.5%, with a PMI of 0.5%, and a property tax rate of 1.25% (interest, PMI, and prop. tax were the default rates in the calc. since we don't know what hers were), a $100K house could be paid off in 15 years at a tad over $1,000 a month.

For this woman's monthly payment to have been $1,450, she had to have borrowed a BUTT TON of money at the refi., especially considering that she originally bought it in '01 and didn't refi. until '05.

I'd like to know where all the cash went.

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Maybe it aint the bank. Maybe its the property taxes.

My cousin in New Jersey pays more local tax per year for a similar house, than i pay for a mortgage and taxes and insurance per year.

jba4241 said:

.............. It's not as if the bank didn't get a large chunk, probably a HUGE chunk, of its money back.

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This is the missing link, we need to get familiar with Fractional Reserve Banking.

See, the Bank doesn't really loan *anything*, they pretend to make a loan, but in actuality use other people's deposits to fund this so called "loan". They loan nothing, literally and risk nothing. But *you* pay back "real" FRNs. They only shuffle 0s on the computer databases.

Has been this way for most of 20th century.

We are a little slow, aren't we?

It's not like the bank has a bag full of silver coins with you name on it approved to loan you, that they give you and a Note.

this is not 19th century anymore, better wake up to the realities of things.

It's fraud through and through.

But the banks got a mountain of FRNs to bail *them* out. Have you seen a pic of a trillion FRNs. It's completely astounding, it's orders of magnitude bigger than a "billion".

They stole from you, so your kids might go hungry but the elites will fly in private jets, eat black caviar with wine and look down upon us starving J6Ps.

Clearly, it's every man for himself now. Get what you can off the dying carcass that used to be the Republic, soon there won't be even that.

It's foolish to the extreme to play by their rules that can only lead to your defeat.

Remember Greenspan's book Irrational Exuberance. Irrational My @ss. It's perfectly rational. People like rats respond to stimuli. They were stimulated to borrow debt up to their eyeballs. Now it's irrational? If you saved, you were penalized. So this person is a product of the System, aren't we all?

The real collapse will come when the man on the street, you know J6P will realize that he is never getting any entitlements he paid into, like SS and stuff, estimate how much he paid into the non-existent system and just claim his own.

Me thinks TSHTF is right around the corner.

Southside said:

I agree 100% with the above.

Southside

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There are some pretty nasty comments up there...the article does say she lost her job. Obviously, while she was working, she made enough money to pay her bills--or they wouldn't have given her the mortgages. Now she is unemployed.

And as for her being an "ugly fat bitch"...how on earth could you know? I've seen how some of these guys gripe because women are bitches, but I've seen the women they pick...all looks and no brains...and no heart. You don't know this woman's heart and you don't know her work ethic...she stated in the article that she wasn't physically able to work on the house herself.

As one of the "ugly fat bitches" of the world, I take umbrage at the tone...no-one (not even when I was married) bothered to help support me or my children and neither did they offer to put a nail in a board.

It wasn't until the last two years or so that I made friends who are willing to share labor around our various houses and guys who'll come help me with the heavy stuff.

And, as for the mortgage--it is a secured loan. Both parties know going into the agreement that the home will be forfeited if the payments can't be made. It seems pretty cut and dried to me. Personally, I have mortgage insurance. But not everyone thinks that's important. It's expensive, but gives me peace of mind. Come to think of it, I need to dig out the paperwork and keep it handy...just in case.

Kent said:

Greed on the part of homeowners for "stuff" ever enter the picture? They don't hold a gun to your head to make you borrow the money. .

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Actually they do just that. The gun is the depreciating FRNs. If you save, you are penalized. If you invest in bubbles, you do well. The system rewards risk and fraud and mal-investment and bubbles. If you save FRNs under your mattress, you are beyond St00pid, because one day you wake you with a pile of paper fit to start a fire in your fireplace.

And so they respond to the stimuli. The FRS is far worse than a "gun", it shapes behavior of the whole Society, and you know what else? It re-engineers the society on its cultural level. We are just rats in an experiment.

Time to get used to some basic realities, how about investing 20 FRNs in some edumacational literature such as The Creature from Jekyll Island.

jba4241 said:

To reiterate, these banks have generally received a substantial sum in payments before a buyer defaults. Let's not forget about THOSE payments.

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Right , not only that, but *most* of the payments they are interest only.

Reminds me why I will *never* buy a house on a Note. Only if I get enough cash together, and since that's about as likely as a dog learning to read Shakespeare, I suppose I will rent for the rest of my life, instead of playing their Fractional REserve Banking game and living in fear for the rest of my life.

These stories are exactly the reason I have my worldviews. It's the worst case scenario, for sure.

Mixin said:

The banks got their bailout and used it to their benefit. Americans are receiving no bailout and are doing what they need to do.

No one should be smug in these times...

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come to think of it, the banks should have all failed.... but the fact they were bailed out with *your* funds, sends a message to them that it pays to be reckless and go into risky situations.

In fact the prudent banks, conservative ones, cannot compete with this climate and are destroyed.

These bailouts *insure* we will have more of the same. When I don't know. 10 years. 20 years? Same olde sheet for sure. Pos reinforcement for criminal behavior, perpetuating this behavior. Poor Joe Six Pack too stupid to see how bread is stolen from his plate in front of him.

Jazzdad said:

Pretty stupid move on the bank's part lending so much money on such a crappy house. Remember those Ditech ads for lending at 120% of assessed value. That stupidity went on for YEARS. And who is paying for that stupidity? The taxpayers. Each and every one of those banks that made those stupid decisions should fail. Stupid should hurt.

Corporations default on their obligations all the time and reopen for business the next day. It's business and is treated like just another business transaction. Why is a mortgage any different. The mortgage agreement calls for the bank to take the house and the bank takes the house. I'm sure those astute businessmen at the bank were aware this might happen.

If we had allowed ALL these stupid and corrupt banks to fail, we would already be out of this mess. The billions spent on TARP could have help fund hundreds of new banks with clean balance sheets. FDIC could have bailed out the depositors like they have promised all these years. Depositors could have moved to a new safe bank. Instead we are left with the same sorry crooks that got us into this mess in the first place.

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Right... if they failed, they would have gotten the message that criminal behavior is not supported, instead they got the opposite mesg, now matter what they do, they will be bailed out.

this practically insures there will be much more of this.

William said:

Your right it didn't come out of thin air, it came off Federal Reserve printing press that cost almost nothing to produce, and is backed by nothing.

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the gov is the only agency that can take valuable resources such as ink and paper and make them worthless.

etc said:

Reminds me why I will *never* buy a house on a Note.

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By renting, you are most likely paying someone else's note. What's the difference? At least your landlord has a piece of paper with his name on it. You have nothing, really.

etc said:

the gov is the only agency that can take valuable resources such as ink and paper and make them worthless.

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She borrowed money against an asset in good condition at appraisal.

She is now walking away from said asset and it is in bad condition if it needs roof work and bathroom work.

No way should the bank work with someone who won't maintain the asset in acceptable condition while that someone still owes money on it.

I am more than happy to agree that the banks need to accept a whole lot of blame, but in this case she had an appraised value at loan time and then did not maintain the home.

Not making payments and turning the thing over in good condition is one thing.

Letting the house fall apart around her and then walking away is a bit different.

I am kind of wondering what the condition of the house would be if she kept her job and kept making payments and ever paid it off?

jba4241 said:

Whatever the amount, the bank agreed to it. They felt the house was worth it. Why aren't you pissed off at the bank for making such a dumbass decision? And YOU are also missing the fact that she made payment for years. It's not as if the bank didn't get a large chunk, probably a HUGE chunk, of its money back. Yes, the principal may not have been paid down much, but how much interest did she pay? Or are we supposed to pretend the interest payments she made didn't go to the bank?

Bankers are greedy sons of bitches, the whole lot of them. They rape us with their interest rates, and people like you pity them when THEY make a bad decision.

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Then don't buy a house on credit. Jeesh!!!!!!


If people are so pissed at "banksters" then rent for crying out loud.