Poll: Underwater

[frankf]

Assuming you would be able to get another place for your family to stay, let it go, let them take it away you should even get a few months mortgage free until the come take it away.

[HowboutthemCowboys]

Safety is a very real issue, in addition to my wife's mental health and the future of our marriage. I've tried every possible way of putting a bright face on it. We spend weekends out of town. We put in a home theater in the basement so we can blast a movie to drown out the packs of screaming kids and barking dogs outside. We tell ourselves it will get better. The reality is that our day to day existence is pure unmitigated hell, and I fear my wife is headed for clinical depression.

sorry. that sucks.

[Ursa Majoris]

MM typically sounds crazy to me, but this idea might have some merit.

+1 I can't believe I'm endorsing a Moneymakers post but it does indeed make sense on the face of it.

[Rovers]

Screw the banks, they have screwed us. All the more reason to walk away if ther nieghborhood is goiung downhill.

 

Walk away, and start over.

[polksalet]

I was raised under a certain code of responsibility. I was taught that your word is your bond and if you try hard in this country you will succeed. Now the reality is...

 

1. If you have enough clout of debt the government will steal from me to pay for your mistakes.

 

2. If someone is unwilling to take care of themselves by providing health insurance the government will steal from me to provide it.

 

3. If someone spends their young life smoking crack while productive citizens try to succeed, the government will steal from us under penalty of imprisonment to provide them decent housing.

 

Therefore, I really don't care how bad you screw the bank. I find it humorous. They are part of the problem. While you are at is go test drive 700 GM vehicles this weekend and if at all possible drive them on the baja circuit.

[Rovers]

I was raised under a certain code of responsibility. I was taught that your word is your bond and if you try hard in this country you will succeed. Now the reality is...

 

1. If you have enough clout of debt the government will steal from me to pay for your mistakes.

 

2. If someone is unwilling to take care of themselves by providing health insurance the government will steal from me to provide it.

 

3. If someone spends their young life smoking crack while productive citizens try to succeed, the government will steal from us under penalty of imprisonment to provide them decent housing.

 

Therefore, I really don't care how bad you screw the bank. I find it humorous. They are part of the problem. While you are at is go test drive 700 GM vehicles this weekend and if at all possible drive them on the baja circuit.

 

Yes, that is the deal. Until the other party violates it. Then there is no more deal. The banks violated the deal. You want to hold up your end when the other end was dropped? Admirable... but, perhaps, foolish.

[alexgaddis]

Not sure if this has been brought up yet but you probably have no chance of a short sale if you make decent money and can afford your payments...there are ZERO programs/options unless you have a hardship or are behind in the mortgage

[dmarc117]

im no expert, but i dont think you can just rent your place under section 8. there has to be guidelines or certain criteria to meet..

[Riffraff]

Another vote for short sale-ish type move. If you bought it for 280 and would have to take a 40k hit to get out, I'd think about it. If you seriously make top 5 percent money, I don't see how the price of a nice car is going to keep your family in your current spot. Move out, and get an apartment and save everything you can for 2 years. if your wife seriously considers it to be that bad, there has to be an area should could live in (and get by with less space) while you pocket the difference between your old mortgage and your current rent to recover the $$. I'd do a lot of research before considering "walking off". It just smells like something will come back to bite you in the arse. Good luck bro.

This is what hit home for me. If you truly make top 5% income, you took about the same beating with your 401k and other market investments (depending on how much you've been puting in and for how long).

 

I had to look up what top 5% earners earned:

The 2005 economic survey revealed the income distribution for households and individuals whereby the top 5% of individuals had six figure incomes (exceeding $100,000) and the top 10% of individuals had incomes exceeding $75,000.[4] The top 5% of households, three quarters of whom had two income earners, had incomes of $166,200 (about 10 time the 2009 minimum wage in the US) or more,[8] with the top 10% having incomes well in excess of $100,000.[9]

These were 2005 figures, so it would be a small bump up 5 years later. I'd agree that a $280k home is way below your expected standard of living.

 

Why is 40k even an issue? It's a quarter of what your yearly household income is. Go buy a new home and rent this one out.

Edited May 11, 2010 by Riffraff

[Big Country]

According to this article, you may actually help stimulate the economy by walking away.

[dmarc117]

could take awhile to get another mortgage if you walk away

[matt770]

Update, in case anyone cares -- we are not walking away. I can't say I was crazy about the idea to begin with, but in Maryland it would be pretty much impossible as they could go after our 401(K). And I don't want to wreck the excellent credit I've built up over the years.

 

If you could see the people who moved in next door, the chaos, the dogs barking around the clock, the debris all over their yard, maybe you could relate to the desperation of just wanted to get the hell out ASAP. But we made our bed and we're stuck here for now. I knew this thread would offer some perspective and I appreciate everyone who replied.

 

Some good news -- our lender agreed to refinance at a savings of 2.25%. That is going to significantly reduce our payment and accelerate paying down the principal (since we'll continue to pay the same amount every month).

 

One more day is this hellhole of a neighborhood is too many, but at least we can see some light at the end of the tunnel.

[Delicious_bass]

Update, in case anyone cares -- we are not walking away. I can't say I was crazy about the idea to begin with, but in Maryland it would be pretty much impossible as they could go after our 401(K). And I don't want to wreck the excellent credit I've built up over the years.

 

If you could see the people who moved in next door, the chaos, the dogs barking around the clock, the debris all over their yard, maybe you could relate to the desperation of just wanted to get the hell out ASAP. But we made our bed and we're stuck here for now. I knew this thread would offer some perspective and I appreciate everyone who replied.

 

Some good news -- our lender agreed to refinance at a savings of 2.25%. That is going to significantly reduce our payment and accelerate paying down the principal (since we'll continue to pay the same amount every month).

 

One more day is this hellhole of a neighborhood is too many, but at least we can see some light at the end of the tunnel.

FWIW, I think you're doing the right thing. Might be tough sledding for a while, but the right way isnt always the easy way. Hope it works out for you.

[dmarc117]

maybe pay an extra payment if you can afford it. will get u whole faster.

[TimC]

I would invite your neighbors over for your ski party where everyone wears a mask to hide their identifty and then kill them as intruders.

[westvirginia]

I would invite your neighbors over for your ski party where everyone wears a mask to hide their identifty and then kill them as intruders.

 

Timmay is a mf'n genius!

[Kid Cid]

Update, in case anyone cares -- we are not walking away. I can't say I was crazy about the idea to begin with, but in Maryland it would be pretty much impossible as they could go after our 401(K). And I don't want to wreck the excellent credit I've built up over the years.

 

If you could see the people who moved in next door, the chaos, the dogs barking around the clock, the debris all over their yard, maybe you could relate to the desperation of just wanted to get the hell out ASAP. But we made our bed and we're stuck here for now. I knew this thread would offer some perspective and I appreciate everyone who replied.

 

Some good news -- our lender agreed to refinance at a savings of 2.25%. That is going to significantly reduce our payment and accelerate paying down the principal (since we'll continue to pay the same amount every month).

 

One more day is this hellhole of a neighborhood is too many, but at least we can see some light at the end of the tunnel.

If things are too out of control you can always call the county to see if there is anything they can do. You never know, but there may be some type of health violation they can use to help clean up the yard.

[Ursa Majoris]

Timmay is a mf'n genius!

+1. Utterly brilliant.

[Scooby's Hubby]

$220, 000 is affordable to as you say "ghetto trash"? I don't think so. Your house would have to lose more value than you described to be upside down on. On 60 minutes the AZ couple truly had a worthless house compared to their note. And looking at that house, I cannot believe they paid that much for it, it looked old and rundown somewhat. But, if you want out of the neighborhood, then you will have to take a loss, unless you want to be a rentor for awhile. Do what you have to do and don't flive in regret. You want out then bail however you have to. Even though noone will give you a loan for welching on a mortgage (and dont felch on one either, LOL), you can still rent.

Edited May 29, 2010 by Scooby's Hubby

[Big John]

Tried to refiance but found out I was deep underwater because of some foreclosures in the area. Will try to ride it out.

[matt770]

We have revisited this and I am seriously considering walking away again. The values here continue to plummet and houses continue to go up for sale, with few takers. At this rate it will be 5 or 10 years before we broke even, maybe even longer if these become section 8 rentals, and living here that long simply is not an option.

 

Not sure where I read that bit about them going after my 401(k). That's not allowed. Although Maryland does allow for deficiency judgments, I'm hearing they are very rare because of the flood of foreclosures right now and the time and money involved in suing people who may not have any assets to go after. In most cases the lender writes off the loss and the borrower takes a hit to his credit for a year or two. I have excellent credit and can deal with a 100-150 point drop for a while if it means I get to leave this neighborhood and get a good night's sleep again.

 

Obviously this is not an easy decision, nor one we take lightly. We're having to rethink how we look at this mortgage -- in the end it's simply a contract that we entered into with provisions covering what happens in case of default (lender gets the house back). If I decide I am willing to accept that consequence, then no one can tell me that what I'm doing is immoral. Businesses do it all the time with commercial real estate and I see very little difference here -- except we have more to consider than just the bottom line. Our sanity and peace of mind are at stake, and the possibility of starting a family which has been on hold because of where we live.

 

Those of you who don't follow this stuff, some interesting articles about the foreclosure mess:

http://online.wsj.com/article/SB1000142405...=googlenews_wsj

http://www.bloomberg.com/news/2010-10-12/d...anley-says.html

http://www.usatoday.com/money/economy/hous...oratorium_N.htm

 

Anyone in a similar boat considering walking away:

http://www.strategicdefault.org/

[Chief Dick]

Hell, put a sign in the yard. Sell it for whatever you can, and if you have to dip into 401K/savings to pay the difference do it.

[Azazello1313]

well, I wish you luck, but part of me has to hope it's not quite that easy to walk away from your debt. just take a little 100 point credit hit for a couple years and that's it? all your other assets ride off scot free? doesn't quite sit right with me. this contract you're talking about gives them a solid legal right to come after you in a judgment. you seem to be banking on them giving that right up for squat. well, again, good luck with all that.

 

I guess I would have to say, if you're young enough to start a family, you're probably young enough to start over to some extent on the retirement savings.

[matt770]

well, I wish you luck, but part of me has to hope it's not quite that easy to walk away from your debt. just take a little 100 point credit hit for a couple years and that's it? all your other assets ride off scot free? doesn't quite sit right with me. this contract you're talking about gives them a solid legal right to come after you in a judgment. you seem to be banking on them giving that right up for squat. well, again, good luck with all that.

 

I guess I would have to say, if you're young enough to start a family, you're probably young enough to start over to some extent on the retirement savings.

 

The lenders barely have the resources to process all the foreclosures, and in many cases they are botching the paperwork because they have people signing stacks of papers without reading them. You think they have the time to examine every default and determine who has assets to go after? And you know what, the mortgage companies and the gov't got us unto this mess, handing out mortgages to people who had no business qualifying. I'll be damned if I'm going to wreck my future out of some sense of obligation to these people. Again, I'm willing to accept the consequences of this decision. They want to sue me, my lawyer will work to negotiate a settlement or help me protect my assets. No way in hell I'm touching retirement money.

[Ursa Majoris]

The lenders barely have the resources to process all the foreclosures, and in many cases they are botching the paperwork because they have people signing stacks of papers without reading them. You think they have the time to examine every default and determine who has assets to go after? And you know what, the mortgage companies and the gov't got us unto this mess, handing out mortgages to people who had no business qualifying. I'll be damned if I'm going to wreck my future out of some sense of obligation to these people. Again, I'm willing to accept the consequences of this decision. They want to sue me, my lawyer will work to negotiate a settlement or help me protect my assets. No way in hell I'm touching retirement money.

I used to largely agree with Az's stance on this issue but of late I've read more and more about the way mortgage companies have been behaving in every aspect of this game and now I say F 'em, they don't give two chits about you and would dump your ass on the street in a NY minute, so why should you care about them? Your note above about them not bothering to process documentation properly is totally accurate and the reason why one of them (I think BoA) has halted foreclosures everywhere because pretty much every state was lining up to sue them.

 

They get to keep every cent you've ever paid them plus they get the house. You get nothing except a fresh start. Again, F 'em, do what's right for you.