Comments on: Lowenstein Advises Homeowners to Just Walk Away

By: OS perspective

OS perspective — Sat, 15 May 2010 07:34:10 +0000

Americans don’t want to pay their debts – Even to each other. And seem to have become well versed in the art of convincing themselves they shouldn’t have to – Much like the Greeks? Good heavens; If word of this was to get out overseas, foreigners may begin to suspect America was a poor credit risk. And tell it to fund its own present and future liabilities with its freshly printed paper – Good luck with that!

By: GP

GP — Mon, 10 May 2010 19:50:41 +0000

This article does not take into account that these are unique times that require unique outcomes. This is the first time there has been a major collpase in the Housing Market. The govt. offers bail outs to major industries that are hurting financially, but if homeowners decide to bail themselves out because no one else will, it is considered a terrible thing.

By: jessica gonzalez

jessica gonzalez — Mon, 15 Mar 2010 18:05:54 +0000

Not a word was mentioned in your op ed about predatory lending, and that seems to be the white elephant that no one in mainstream media wishes to discuss. Thanks to recent legislation, if corporations-and perhaps that includes the banks-can enjoy the protections of “personhood”, shouldn’t they be expected to follow the same moral guidelines as the average homeowner? Also, please consider that homeowners who can still afford their mortgages walk away for purely financial motives ;corporations act in bad faith for the same reasons. Homeowners who walk away suffer bad credit for years thereafer. Many won’t even have the proper credit rating to rent a home. Banks who’ve engaged in questionable lending practices get bailed out. Why the double moral standard? If our lending institutions can’t be trusted to act in good faith, then it’s hypocritical to expect the American public to get in line like good little boys and girls. The problem is, those who abandon their homes and mortgages do so to their own detriment, and as you say, the rest of us end up paying as well. The banks need to be better regulated, and if that day ever comes,then we can have a real discussion about what constitutes moral, “mature” behavior.

By: Irv Wilson

Irv Wilson — Fri, 22 Jan 2010 17:04:45 +0000

In you article you mention that your “very strong preference is that any homeowner capable of paying his or her mortgage who walks away from it simply because they don’t want to pay it any longer have their credit rating lowered significantly.” Are you saying that doesn’t happen? The last Fannie Mae underwriting guidelines I checked stated that Fannie Mae will not purchase loans made to borrowers who have had a foreclosure in the last five years or a deed in lieu in the last four. In terms of raw credit point scores I’m very certain both of the above events have strong negative effects as well. Perhaps there are exceptions to the above but I believe that’s the general result (among others) from having a foreclosure on one’s credit. It’s hardly fun and games. People speaking or writing about others who have walked away from their homes do so with an insinuation that there’s a certain “glibness” to the act that I just don’t think is there in the vast majority of cases. The idea that they’re walking away from the home they currently own and then buying the one down the street “on the cheap” is the other fantasy I see played out alot. By and large it simply does not happen. To see Fannie’s guideline changes go to https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0816.pdf.

By: callawar

callawar — Mon, 11 Jan 2010 13:57:43 +0000

I can understand your argument but suppose you bought a 30-yr fixed mortgage home at $450K back in 2004 but in 2010 that same house is worth $230K, what should a wise person do? With such a price reduction the neighbors are feeling the same pinch. It will take many decades before the house can (probably) be sold at the purchase price. What is not mentioned is Congress has given corporations a lot of latitude to write down debt. In some cases, Congress provided morale hazard for some industries by taking tax payer money to pay off failed enterprises debts no matter the risk. Double standard?

By: John Smith

John Smith — Mon, 11 Jan 2010 12:12:27 +0000

Don’t worry the housing market will collapse as soon as the FED stops backing up all the mortgages at which point most people will be able to buy a house with 20 or 30 percent down.