Smalltownbanker

The Economics and Ethics of Mortgage Default

This is a sad commentary on what this nation has degenerated into. I am glad my father is not around to see this. I am disgusted by the continual discussions about walking away from your debts, your responsibilities and the suggestion that someone quit their job as a means to put pressure on a lender to lower the payment or principal balance. I am disgusted by a government that thinks it can fix deadbeats by lowering their payments.

I read this morning that 25% of the modified loans are delinquent after the first payment beyond modification and 50% are delinquent after mulitiple payments. Why bother? Anyone who would consider this approach to the mortgage note they signed has no right to ever own a home again. In fact I have just bought some new appliances and will happily donate the boxes for their new home under the local interstate highway overpass. I hear they have lots of bridges in California.

By the way, anytime the government offers you money, the collateral is your soul. It is hard much harder to walk away from that lien than it is to walk away from the mortgage.