Thursday, April 22, 2010

Strategic Defaults; Mortgage Foreclosures; Arnold Ahlert

I have written previously about "strategic defaults." This column from Arnold Ahlert summarizes the issue:
Welcome to the brave new world where clever vocabulary confers absolution on rotten behavior. "We weren't in any financial distress, but the value of the house had declined so precipitously that continuing to stay in this house and paying this inflated mortgage made no sense," said Chris Schreur of California, who contacted a company called You Walk Away, which helped him literally walk away from a freely-signed contractual obligation. "My degree is economics, so I understand that you don't keep putting money into a losing proposition just because you already put money in," he added.


Apparently they don't teach ethics along with economics, which might explain a lot about the current state of the country. Mr Schreur continues: "Objectively the hardest part was the hit to the credit rating. Defaulting on a debt is the hardest thing to accept."

Keep in mind also that Pennsylvania law allows a bank to pursue the former homeowner for a "deficiency judgment." This fact should affect any decision that one might make in this regard.

2 comments:

  1. 知足常樂~~有這麼好的文章,人生足矣~~哈哈.........................

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  2. I like this post short but meaningful and helpful. thanks for sharing and i'm looking forward to you next post.

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