I discuss a news piece that aired on 60 minutes last night about a new trend of homeowners walking away from their mortgages even though they can afford their home payments because their mortgage is “underwater”.
Hello everybody and welcome to another episode of The Reside Daily Bite; I’m your host, David Doucette. Today, I’m going to talk about a news piece that ran on 60 Minutes last night. Maybe you watched it; it’s about homeowners who can’t afford to pay their mortgage but deciding not to and just walking away.
Now, a couple of weeks ago, I talked about this exact issue in another episode of The Reside Daily Bite. Essentially, what is happening now is, home values have decreased so much in some areas of the country that homeowners who can actually afford to keep paying their mortgage are deciding to not do that and to walk away. They talked about an area in Phoenix last night and one couple who made that decision –I think their home was about (they’ve purchased a few years ago) $450,000 and it had dropped to $250,000 or something like that. But there was another couple who bought for over $400,000 and the home value was only worth $85,000 today.
So, it is an interesting dilemma for a lot of people and it sounds like a lot are wrestling with the idea of just walking away from mortgage –walking away from something that they agreed to pay for and agreed to uphold. One of the gentlemen last night talked about that and he was brought up learning the principles and being responsible for your contractual obligations.
The purpose of today is that they talked about an organization –You Walk Away. You can find them at youwalkaway.com and what they can do is really help you navigate through the foreclosure process. Coming from their website, “We strive to help people understand their rights and know their options.”
And if you’ve been watching The Reside Daily Bite, if you’ve been listening to the Approachable Architect podcast, if you’ve been listening to The Reside Realtor Online Radio Show (if you’ve been listening to the phone ring in the background because I’m going to turn that down…), you know that that’s what I’m about. I want people to have the right information. So for you to decide to walk away…only you can decide that; nobody else can do that for you. But what I want to put out there is, make sure you’re getting the right information so you can make an informed decisions. By all means, go to YouWalkAway.com. They have a free consultation. You Walk Away have supported over 4,000 people to prepare and strategically navigate through the foreclosure process. They have received a lot of press coverage on Good Morning America, ABC Nightline, The Today Show, NBC Nightly News and PR. So, really check them out.
You’ll find, based on the article last night, a lot of the banks are not really negotiating (and re-negotiating) with home owners. They’re really taking a hard line on this stuff, so, I know homeowners are not taking this stuff lightly. And I think it has become a last resort for many because it’s just not making financially sense (or may not make financially sense) to keep paying on something that’s no longer worth that. And if you’re tuned in last week, you know we were talking about negative equity and in many parts of the country, were going to be seeing negative equity until 2015 and in some cases, to 2020.
So that is my spill for today; questions or comments, 1-800-476-5579 or email firstname.lastname@example.org. I’m your host, David Doucette. Thank you so much for checking out The Reside Daily Bite.