He rents a house even for 80% for 7 yrs. Your still looking at throwing 80K away. that more then he would lose by staying in his house. Eventually he will work through the negative equity and generate positive equity. That's without an upward trend happening.
Even if he can get back to the point of owning a new home.whats to stop him from jumping ship the next downturn.
If you can afford X payment now, then making Y payment (where Y < X) you should be able to put aside the difference. Odds are, especially for the next 10 years (if not longer) that difference will be larger than the amount of principle he is paying off each month.
And again, this all goes back to the specifics.
Like Americans (includes me) actually save money. The reason he is in this mess in the first place is probably because instead of putting that important 20% he put 0% down. If he could save money he would or should have put money down if not just to get a much lower interest rate. But the problem is he would need to rent for less then the 30% he is losing to make it any different then owning the home in the first place and at the end you still own a home with equity.
The only reason it would make sense to opt out now would be.
1. He is struggling.
2. He has no Family.
3. The house may be worth as little as $1
4. He is struggling badly and is going to default anyways and if he does he owes the bank the differnce in value and what he owes and it is now worth $1.
What you are suggesting is to make an annoyance (like my 401k being down 40%) and putting yourself and your family in an unstable environment. While making the problems worse for the rest of the US. All the while never knowing if you can fix the damage you have done. For what? Chasing a few dollars you probably will never get? What happens when your Land Lord increase your rates? What is better having to pay for a repair here or there or having to wait for someone else to reapir it the cheapest way possible?
He could go for option 5. Learn what the fuck he is doing for future choices.
Again, just because he may have made risky/poor choices in the past (and I am assuming you are correct about 0% down), does not mean to keep making the same style of decision going forward.
And I am really amused that nobody is upset about the people that were buying/selling these obligations as if they were worth the money now. That is far more responsible for this mess than folks getting out of loans they shouldn't have gotten into.
Try telling an 80-year-old woman who bought a house, paid off the mortgage responsibly 30 years ago, and is now looking to sell it so that she can afford to live in an assisted-living facility that it was a good idea to "build equity" instead of put the difference in something like an assisted-living insurance fund, or bonds.
Agreed so hard I think it hurts!!!
Wow just wow. If you look over the growth charts that house is worth some much more then she paid off even now. Yeah sucks Grandma might have gotten an extra 30k here or there but she isn't going to be struggling really any more today then she was 3 years ago. A return is a return. My 401k losing more money this year then I put in that sucks, but right now is the time to be putting money in.
And if you spent $1200 a month on an apartment over the course of 30 years? You just threw away that $400,000 into nothing.
You have no equity. Nothing, not even $1.
Did you miss where I said that combined with rent he should be paying less even if he has to pay off all of what he legally owes?
If you can not find a place to rent for cheaper than buying by a substantial amount, you should seriously consider what you are looking at. Move if you have to.
It's not though. At least around here houses and apartments are roughly equal to prices per month and the mortgage per month. Crazy.
They are here, too - a good mortgage on my house would be about $600, which is market rent on a single bedroom apartment. However, tack on $1500 every six months in property tax, $800 a year in basic homeowner's insurance (which is effectively a must for a homeowner), and the higher bills, and it IS substantially more expensive than an apartment. Once you're out from under the mortgage, it's actually quite a bit cheaper, though. Right now, I can't afford to move out of the house and into an apartment.
Try telling an 80-year-old woman who bought a house, paid off the mortgage responsibly 30 years ago, and is now looking to sell it so that she can afford to live in an assisted-living facility that it was a good idea to "build equity" instead of put the difference in something like an assisted-living insurance fund, or bonds.
Agreed so hard I think it hurts!!!
Wow just wow. If you look over the growth charts that house is worth some much more then she paid off even now. Yeah sucks Grandma might have gotten an extra 30k here or there but she isn't going to be struggling really any more today then she was 3 years ago. A return is a return. My 401k losing more money this year then I put in that sucks, but right now is the time to be putting money in.
That depends entirely on when and where she bought. I have family that have bought in places where the value of the home hasn't changed... well, ever. And again, brings the entire thing back down to "specifics matter."
He could go for option 5. Learn what the fuck he is doing for future choices.
Again, just because he may have made risky/poor choices in the past (and I am assuming you are correct about 0% down), does not mean to keep making the same style of decision going forward.
And I am really amused that nobody is upset about the people that were buying/selling these obligations as if they were worth the money now. That is far more responsible for this mess than folks getting out of loans they shouldn't have gotten into.
Because that's what the banks do. It might have been why houses dropped in value. But it because of people like the OP that we are all on the tab for ~2 Trillion dollars. Banks treated the markers like bills, that works somewhat well. People start treating their home (the house not the loan) like its a piece of stock that causes a bailout package.
Because that's what the banks do. It might have been why houses dropped in value. But it because of people like the OP that we are all on the tab for ~2 Trillion dollars. Banks treated the markers like bills, that works somewhat well. People start treating their home (the house not the loan) like its a piece of stock that causes a bailout package.
They're not treating it like a piece of stock. A piece of stock you have to sell and take the loss...they already have your money.
mcdermott on
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ElJeffeNot actually a mod.Roaming the streets, waving his gun around.Moderator, ClubPAmod
4. Live in/maintain/be tied to the same location for the next 15-30 years
5. Have huge amounts of money locked in a single property (really, a long-term loan on a property) for decades
6. Etc. etc. etc.
1. The mortgage deduction on your income taxes likely cancels out the property taxes.
2. Mortgage payments stay the same while rent increases over time.
3. After 15-30 years you needn't ever pay rent or mortgage again.
4. You can do whatever you want to the inside of your place, and likely the outside within the bounds of any HOA or CCR restrictions.
5. You don't have to worry that you're suddenly going to be booted out by the owner for whatever reason.
6. Etc. etc. etc.
Owning is not preferable to renting in every last situation for every last person. But on balance, it's generally a smart thing to do.
As to the OP, bad idea. Unethical and untenable.
ElJeffe on
I submitted an entry to Lego Ideas, and if 10,000 people support me, it'll be turned into an actual Lego set!If you'd like to see and support my submission, follow this link.
And if you spent $1200 a month on an apartment over the course of 30 years? You just threw away that $400,000 into nothing.
You have no equity. Nothing, not even $1.
Did you miss where I said that combined with rent he should be paying less even if he has to pay off all of what he legally owes?
If you can not find a place to rent for cheaper than buying by a substantial amount, you should seriously consider what you are looking at. Move if you have to.
It's not though. At least around here houses and apartments are roughly equal to prices per month and the mortgage per month. Crazy.
They are here, too - a good mortgage on my house would be about $600, which is market rent on a single bedroom apartment. However, tack on $1500 every six months in property tax, $800 a year in basic homeowner's insurance (which is effectively a must for a homeowner), and the higher bills, and it IS substantially more expensive than an apartment. Once you're out from under the mortgage, it's actually quite a bit cheaper, though. Right now, I can't afford to move out of the house and into an apartment.
I can get the same square footage for less if I were to move after factoring in all that shit. Plus the discounts I get with multiple insurance policies are wonderful enough to make up a lot of that difference, and $800 is nothing if you're already paying for renters insurance. Which is a must.
Edit: And what ElJeffe said, he's a smart cookie.
bowen on
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
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Inquisitor772 x Penny Arcade Fight Club ChampionA fixed point in space and timeRegistered Userregular
Try telling an 80-year-old woman who bought a house, paid off the mortgage responsibly 30 years ago, and is now looking to sell it so that she can afford to live in an assisted-living facility that it was a good idea to "build equity" instead of put the difference in something like an assisted-living insurance fund, or bonds.
Agreed so hard I think it hurts!!!
Wow just wow. If you look over the growth charts that house is worth some much more then she paid off even now. Yeah sucks Grandma might have gotten an extra 30k here or there but she isn't going to be struggling really any more today then she was 3 years ago. A return is a return. My 401k losing more money this year then I put in that sucks, but right now is the time to be putting money in.
What market are you talking about? Which house? I didn't even mention where the place was, what it was worth when she bought it, and what it is worth now, and you're making another generalization based on...what? The median value of a home in an average market over the course of 50 years? I'd like to see that spreadsheet, please.
My point was specifically that you can't know the future value of your house when you plan on, or need to, sell it. Maybe the house is worth more than when she bought it, but maybe she was planning on it being worth more because that's what everyone (stupidly) told her it would be worth. Which goes back to my point - that you shouldn't be doing shit like that in the first place.
So anyway, has anyone ever heard these rumors about realtors getting so desperate for money that they have left the property market altogether and are now trying to get old folks to use their life insurance policies as collateral for loans they need to pay medical bills? No, wait, that really is happening. Apparently it's been happening for the past several years.
Sorry, that was a complete sidebar. Back to the OP - I think you have your answers, dude. Good luck.
Try telling an 80-year-old woman who bought a house, paid off the mortgage responsibly 30 years ago, and is now looking to sell it so that she can afford to live in an assisted-living facility that it was a good idea to "build equity" instead of put the difference in something like an assisted-living insurance fund, or bonds.
Agreed so hard I think it hurts!!!
Wow just wow. If you look over the growth charts that house is worth some much more then she paid off even now. Yeah sucks Grandma might have gotten an extra 30k here or there but she isn't going to be struggling really any more today then she was 3 years ago. A return is a return. My 401k losing more money this year then I put in that sucks, but right now is the time to be putting money in.
That depends entirely on when and where she bought. I have family that have bought in places where the value of the home hasn't changed... well, ever. And again, brings the entire thing back down to "specifics matter."
If it hasn't changed then where is the issue? Markets like that don't change because there is no turnover. So your saying now with people who have been in there houses .....well forever..... That all of a sudden because of this drop in value elsewhere that all of a sudden turn over has increased?
He could go for option 5. Learn what the fuck he is doing for future choices.
Again, just because he may have made risky/poor choices in the past (and I am assuming you are correct about 0% down), does not mean to keep making the same style of decision going forward.
And I am really amused that nobody is upset about the people that were buying/selling these obligations as if they were worth the money now. That is far more responsible for this mess than folks getting out of loans they shouldn't have gotten into.
Because that's what the banks do. It might have been why houses dropped in value. But it because of people like the OP that we are all on the tab for ~2 Trillion dollars. Banks treated the markers like bills, that works somewhat well. People start treating their home (the house not the loan) like its a piece of stock that causes a bailout package.
No, the banks and investors started treating real estate like it was a guaranteed growth stock market. They "diversified" by combining tons and tons of mortgages together so that they could guarantee their value. They also had plenty of other fancy tools they used to try to say this was a guaranteed success. This led to them not really even looking at what they were doing. Had they always required the 20+% down, they would have plenty of capital to spare to invest in other things. However, many people took loans from institutes (some which were ultimately backed by other similar loans) to cover that 20% so that they didn't put anything down at all.
Make no mistake, banks/lenders thought they found a fool proof way to generate wealth off of people in the OPs situation. (They also took advantage of folks in far worse situations.)
Try telling an 80-year-old woman who bought a house, paid off the mortgage responsibly 30 years ago, and is now looking to sell it so that she can afford to live in an assisted-living facility that it was a good idea to "build equity" instead of put the difference in something like an assisted-living insurance fund, or bonds.
Agreed so hard I think it hurts!!!
Wow just wow. If you look over the growth charts that house is worth some much more then she paid off even now. Yeah sucks Grandma might have gotten an extra 30k here or there but she isn't going to be struggling really any more today then she was 3 years ago. A return is a return. My 401k losing more money this year then I put in that sucks, but right now is the time to be putting money in.
What market are you talking about? Which house? I didn't even mention where the place was, what it was worth when she bought it, and what it is worth now, and you're making another generalization based on...what? The median value of a home in an average market over the course of 50 years? I'd like to see that spreadsheet, please.
My point was specifically that you can't know the future value of your house when you plan on, or need to, sell it. Maybe the house is worth more than when she bought it, but maybe she was planning on it being worth more because that's what everyone (stupidly) told her it would be worth. Which goes back to my point - that you shouldn't be doing shit like that in the first place.
So anyway, has anyone ever heard these rumors about realtors getting so desperate for money that they have left the property market altogether and are now trying to get old folks to use their life insurance policies as collateral for loans they need to pay medical bills? No, wait, that really is happening. Apparently it's been happening for the past several years.
Sorry, that was a complete sidebar. Back to the OP - I think you have your answers, dude. Good luck.
You shooting in the dark and speculating if she paid it of 30 years ago then chances are even now its worth lots more then it was before. If it's all pretty even. He how didn't increase much before then it didn't decrease much now and more then likely less then what it had increased.
Its not about the Value of the house its about the house. Find me one person that is OK with not owning anything and dying with no value forcing their family to fend for themselves. A house is much more then a couple of dollars you were going to throw away anyways.
Jesus the thread exploded. Certainly a lot to think about, and I do understand people's feeling of being cheated if something like this goes through.
To be clear, we can afford it now - but when we bought the house, we made 40% less total combined than we do now. We put no money down and the lender didn't care we were pushing 45% of our gross with the payment. Of course, yes, we were stupid to buy at such an inopportune time without savings - we too had bought into the "renting is a waste" mentality.
Honestly the prospect of "walking away" seems incredibly risky and not something we would want to go through, both monetarily and morally, but I am just surveying all the options we have. If we could convince our lender to modify the loan somewhat (I am fairly certain the appraised value was inflated as Countrywide has been accused of this) then we would at least be in better shape. We may be down to only my income soon, and that's the part that worries me as well.
He could go for option 5. Learn what the fuck he is doing for future choices.
Again, just because he may have made risky/poor choices in the past (and I am assuming you are correct about 0% down), does not mean to keep making the same style of decision going forward.
And I am really amused that nobody is upset about the people that were buying/selling these obligations as if they were worth the money now. That is far more responsible for this mess than folks getting out of loans they shouldn't have gotten into.
Because that's what the banks do. It might have been why houses dropped in value. But it because of people like the OP that we are all on the tab for ~2 Trillion dollars. Banks treated the markers like bills, that works somewhat well. People start treating their home (the house not the loan) like its a piece of stock that causes a bailout package.
No, the banks and investors started treating real estate like it was a guaranteed growth stock market. They "diversified" by combining tons and tons of mortgages together so that they could guarantee their value. They also had plenty of other fancy tools they used to try to say this was a guaranteed success. This led to them not really even looking at what they were doing. Had they always required the 20+% down, they would have plenty of capital to spare to invest in other things. However, many people took loans from institutes (some which were ultimately backed by other similar loans) to cover that 20% so that they didn't put anything down at all.
Make no mistake, banks/lenders thought they found a fool proof way to generate wealth off of people in the OPs situation. (They also took advantage of folks in far worse situations.)
Sorry to lime the whole goddamned thing, but anyone who thinks that banks acted responsibly should reevaluate why so many of them are in such dire straights. There aren't actually a whole lot of victims in our current financial mess in any particular segment of the market. Mainly what we have are a lot of guilty parties who think that the fact that everyone else's cumulative guilt outweighs their own should mean that they personally shouldn't be held accountable.
Jesus the thread exploded. Certainly a lot to think about, and I do understand people's feeling of being cheated if something like this goes through.
No, I really don't think you do. Sorry.
Next time my advice is to just stick with asking a professional about such issues...not for the usual "only a professional can help you" reasons forbidden in the rules of this subforum, mind you, but because asking if the people you're looking to fuck over know anything about the method you are considering using to fuck them over is in poor taste.
To be clear, we can afford it now - but when we bought the house, we made 40% less total combined than we do now. We put no money down and the lender didn't care we were pushing 45% of our gross with the payment. Of course, yes, we were stupid to buy at such an inopportune time without savings - we too had bought into the "renting is a waste" mentality.
The only part I really care about is bolded.
Honestly the prospect of "walking away" seems incredibly risky and not something we would want to go through, both monetarily and morally, but I am just surveying all the options we have. If we could convince our lender to modify the loan somewhat (I am fairly certain the appraised value was inflated as Countrywide has been accused of this) then we would at least be in better shape. We may be down to only my income soon, and that's the part that worries me as well.
And you should cross that bridge when you come to it. But, and maybe I'm old fashioned, I think you should pay as much of your debt as you are able to. If your income changes such that you can no longer afford the mortgage, there are more traditional options available to you.
And you should cross that bridge when you come to it. But, and maybe I'm old fashioned, I think you should pay as much of your debt as you are able to. If your income changes such that you can no longer afford the mortgage, there are more traditional options available to you.
I don't think I've heard a more pleasant euphamism for being foreclosed upon and forcibly evicted from your property before in my life. Up there with calling a guillotine a close shave.
And you should cross that bridge when you come to it. But, and maybe I'm old fashioned, I think you should pay as much of your debt as you are able to. If your income changes such that you can no longer afford the mortgage, there are more traditional options available to you.
I don't think I've heard a more pleasant euphamism for being foreclosed upon and forcibly evicted from your property before in my life. Up there with calling a guillotine a close shave.
I know, I'm just an ogre for thinking that failing to pay for your house should hurt.
EDIT: Keep in mind that this is from somebody who has been paying rent for half a decade because they chose (wisely) not to buy at the time. Precisely how much sympathy are you expecting out of me? When it's my tax dollars that will go towards what the OP is suggesting.
Has anyone done this, or heard much about it? I am going to talk to a real estate attorney but was wondering if anyone here had experience with this. We could theoretically stop making payments for a few months during proceedings, saving even more money.
Ever heard a better one for stealing?
EDIT: Maybe I should just skip the next six months or so of my rent payments...I mean, we're moving after I graduate anyway. I'm sure my landlord will be cool with it. I'm sure he won't forcibly evict my ass.
Why don't you just fly to Arizona and kick him in the nuts? Seriously, dude, I remember someone my dad worked with killing himself in California after falling behind in his mortgage when IBM axed his department during the downsizing craze of the late 80s/early 90s. It's the most humilitating thing someone can go through, feeling like you're incapable of providing for your family.
I assure you, the OP already feels like a dick without your help. Your insistence that he feel hopeless is, I think, in incredibly poor taste.
I think enough has been said, if this could be locked I'd appreciate it. As I mentioned this is not something I plan to go through with, but something I was asking for more information about. Thanks for everyone who contributed.
Inquisitor772 x Penny Arcade Fight Club ChampionA fixed point in space and timeRegistered Userregular
edited November 2008
mcdermott is being pretty harsh, but to be fair, the OP has admitted twice now that they can afford the mortgage. They're just looking for a better deal.
The whole thing just sucks, guys. Can we just agree that the whole thing sucks? I am making a motion to label the whole thing as sucking. Ayes?
Why don't you just fly to Arizona and kick him in the nuts?
Personally I'd rather just keep my money. I gain no value from kicking him in the nuts.
But to the OP: Don't kill yourself. It's not that bad in the long run, and suicide is a permanent solution to a temporary problem. Doesn't sound like you're considering that route, but just in case...seriously, don't.
mcdermott is being pretty harsh, but to be fair, the OP has admitted twice now that they can afford the mortgage. They're just looking for a better deal.
The whole thing just sucks, guys. Can we just agree that the whole thing sucks? I am making a motion to label the whole thing as sucking. Ayes?
I don't know. Does this whole thing suck?
bowen on
not a doctor, not a lawyer, examples I use may not be fully researched so don't take out of context plz, don't @ me
I think enough has been said, if this could be locked I'd appreciate it. As I mentioned this is not something I plan to go through with, but something I was asking for more information about. Thanks for everyone who contributed.
Why do you want more info if you don't plan to go through with it?
Nice try, dude.
EDIT: Looking for more info implies that it's an option that you're at least considering.
I think enough has been said, if this could be locked I'd appreciate it. As I mentioned this is not something I plan to go through with, but something I was asking for more information about. Thanks for everyone who contributed.
Why do you want more info if you don't plan to go through with it?
Nice try, dude.
Because there may have been factors that would change my decision to wanting to do it? I don't know everything about it, hence asking what people's experience was. Regardless, I get your point.
I hope we've helped you flesh out your options. Remember that there are always options to look for, and they may not always be pleasant, but just as the economy will eventually rebound, so will you. Hope everything works out for the best for all parties involved.
Gotcha. I think I've said everything I feel the need to. Good luck to you, man. I do mean that. It does sound like your situation pretty much sucks, but it'll work out in the long run, one way or another.
Posts
Like Americans (includes me) actually save money. The reason he is in this mess in the first place is probably because instead of putting that important 20% he put 0% down. If he could save money he would or should have put money down if not just to get a much lower interest rate. But the problem is he would need to rent for less then the 30% he is losing to make it any different then owning the home in the first place and at the end you still own a home with equity.
The only reason it would make sense to opt out now would be.
1. He is struggling.
2. He has no Family.
3. The house may be worth as little as $1
4. He is struggling badly and is going to default anyways and if he does he owes the bank the differnce in value and what he owes and it is now worth $1.
What you are suggesting is to make an annoyance (like my 401k being down 40%) and putting yourself and your family in an unstable environment. While making the problems worse for the rest of the US. All the while never knowing if you can fix the damage you have done. For what? Chasing a few dollars you probably will never get? What happens when your Land Lord increase your rates? What is better having to pay for a repair here or there or having to wait for someone else to reapir it the cheapest way possible?
Again, just because he may have made risky/poor choices in the past (and I am assuming you are correct about 0% down), does not mean to keep making the same style of decision going forward.
And I am really amused that nobody is upset about the people that were buying/selling these obligations as if they were worth the money now. That is far more responsible for this mess than folks getting out of loans they shouldn't have gotten into.
Wow just wow. If you look over the growth charts that house is worth some much more then she paid off even now. Yeah sucks Grandma might have gotten an extra 30k here or there but she isn't going to be struggling really any more today then she was 3 years ago. A return is a return. My 401k losing more money this year then I put in that sucks, but right now is the time to be putting money in.
They are here, too - a good mortgage on my house would be about $600, which is market rent on a single bedroom apartment. However, tack on $1500 every six months in property tax, $800 a year in basic homeowner's insurance (which is effectively a must for a homeowner), and the higher bills, and it IS substantially more expensive than an apartment. Once you're out from under the mortgage, it's actually quite a bit cheaper, though. Right now, I can't afford to move out of the house and into an apartment.
That depends entirely on when and where she bought. I have family that have bought in places where the value of the home hasn't changed... well, ever. And again, brings the entire thing back down to "specifics matter."
Because that's what the banks do. It might have been why houses dropped in value. But it because of people like the OP that we are all on the tab for ~2 Trillion dollars. Banks treated the markers like bills, that works somewhat well. People start treating their home (the house not the loan) like its a piece of stock that causes a bailout package.
They're not treating it like a piece of stock. A piece of stock you have to sell and take the loss...they already have your money.
1. The mortgage deduction on your income taxes likely cancels out the property taxes.
2. Mortgage payments stay the same while rent increases over time.
3. After 15-30 years you needn't ever pay rent or mortgage again.
4. You can do whatever you want to the inside of your place, and likely the outside within the bounds of any HOA or CCR restrictions.
5. You don't have to worry that you're suddenly going to be booted out by the owner for whatever reason.
6. Etc. etc. etc.
Owning is not preferable to renting in every last situation for every last person. But on balance, it's generally a smart thing to do.
As to the OP, bad idea. Unethical and untenable.
I can get the same square footage for less if I were to move after factoring in all that shit. Plus the discounts I get with multiple insurance policies are wonderful enough to make up a lot of that difference, and $800 is nothing if you're already paying for renters insurance. Which is a must.
Edit: And what ElJeffe said, he's a smart cookie.
What market are you talking about? Which house? I didn't even mention where the place was, what it was worth when she bought it, and what it is worth now, and you're making another generalization based on...what? The median value of a home in an average market over the course of 50 years? I'd like to see that spreadsheet, please.
My point was specifically that you can't know the future value of your house when you plan on, or need to, sell it. Maybe the house is worth more than when she bought it, but maybe she was planning on it being worth more because that's what everyone (stupidly) told her it would be worth. Which goes back to my point - that you shouldn't be doing shit like that in the first place.
So anyway, has anyone ever heard these rumors about realtors getting so desperate for money that they have left the property market altogether and are now trying to get old folks to use their life insurance policies as collateral for loans they need to pay medical bills? No, wait, that really is happening. Apparently it's been happening for the past several years.
Sorry, that was a complete sidebar. Back to the OP - I think you have your answers, dude. Good luck.
If it hasn't changed then where is the issue? Markets like that don't change because there is no turnover. So your saying now with people who have been in there houses .....well forever..... That all of a sudden because of this drop in value elsewhere that all of a sudden turn over has increased?
No, the banks and investors started treating real estate like it was a guaranteed growth stock market. They "diversified" by combining tons and tons of mortgages together so that they could guarantee their value. They also had plenty of other fancy tools they used to try to say this was a guaranteed success. This led to them not really even looking at what they were doing. Had they always required the 20+% down, they would have plenty of capital to spare to invest in other things. However, many people took loans from institutes (some which were ultimately backed by other similar loans) to cover that 20% so that they didn't put anything down at all.
Make no mistake, banks/lenders thought they found a fool proof way to generate wealth off of people in the OPs situation. (They also took advantage of folks in far worse situations.)
You shooting in the dark and speculating if she paid it of 30 years ago then chances are even now its worth lots more then it was before. If it's all pretty even. He how didn't increase much before then it didn't decrease much now and more then likely less then what it had increased.
Its not about the Value of the house its about the house. Find me one person that is OK with not owning anything and dying with no value forcing their family to fend for themselves. A house is much more then a couple of dollars you were going to throw away anyways.
To be clear, we can afford it now - but when we bought the house, we made 40% less total combined than we do now. We put no money down and the lender didn't care we were pushing 45% of our gross with the payment. Of course, yes, we were stupid to buy at such an inopportune time without savings - we too had bought into the "renting is a waste" mentality.
Honestly the prospect of "walking away" seems incredibly risky and not something we would want to go through, both monetarily and morally, but I am just surveying all the options we have. If we could convince our lender to modify the loan somewhat (I am fairly certain the appraised value was inflated as Countrywide has been accused of this) then we would at least be in better shape. We may be down to only my income soon, and that's the part that worries me as well.
Sorry to lime the whole goddamned thing, but anyone who thinks that banks acted responsibly should reevaluate why so many of them are in such dire straights. There aren't actually a whole lot of victims in our current financial mess in any particular segment of the market. Mainly what we have are a lot of guilty parties who think that the fact that everyone else's cumulative guilt outweighs their own should mean that they personally shouldn't be held accountable.
No, I really don't think you do. Sorry.
Next time my advice is to just stick with asking a professional about such issues...not for the usual "only a professional can help you" reasons forbidden in the rules of this subforum, mind you, but because asking if the people you're looking to fuck over know anything about the method you are considering using to fuck them over is in poor taste.
The only part I really care about is bolded.
And you should cross that bridge when you come to it. But, and maybe I'm old fashioned, I think you should pay as much of your debt as you are able to. If your income changes such that you can no longer afford the mortgage, there are more traditional options available to you.
I don't think I've heard a more pleasant euphamism for being foreclosed upon and forcibly evicted from your property before in my life. Up there with calling a guillotine a close shave.
I know, I'm just an ogre for thinking that failing to pay for your house should hurt.
EDIT: Keep in mind that this is from somebody who has been paying rent for half a decade because they chose (wisely) not to buy at the time. Precisely how much sympathy are you expecting out of me? When it's my tax dollars that will go towards what the OP is suggesting.
Ever heard a better one for stealing?
EDIT: Maybe I should just skip the next six months or so of my rent payments...I mean, we're moving after I graduate anyway. I'm sure my landlord will be cool with it. I'm sure he won't forcibly evict my ass.
I assure you, the OP already feels like a dick without your help. Your insistence that he feel hopeless is, I think, in incredibly poor taste.
The whole thing just sucks, guys. Can we just agree that the whole thing sucks? I am making a motion to label the whole thing as sucking. Ayes?
Personally I'd rather just keep my money. I gain no value from kicking him in the nuts.
But to the OP: Don't kill yourself. It's not that bad in the long run, and suicide is a permanent solution to a temporary problem. Doesn't sound like you're considering that route, but just in case...seriously, don't.
I don't know. Does this whole thing suck?
Why do you want more info if you don't plan to go through with it?
Nice try, dude.
EDIT: Looking for more info implies that it's an option that you're at least considering.
Because there may have been factors that would change my decision to wanting to do it? I don't know everything about it, hence asking what people's experience was. Regardless, I get your point.
I hope we've helped you flesh out your options. Remember that there are always options to look for, and they may not always be pleasant, but just as the economy will eventually rebound, so will you. Hope everything works out for the best for all parties involved.
http://www.irs.gov/formspubs/article/0,,id=178793,00.html
This too
http://www.irs.gov/irs/article/0,,id=179073,00.html
Home Inspection and Wind Mitigation
http://www.FairWindInspections.com/