“The longer I’m in foreclosure, the better,” she said.

[bicker]

Some homeowners just stop paying mortgages

A growing number of the people whose homes are in foreclosure are fashioning a sort of homemade mortgage modification, one that brings their payments all the way down to zero.

http://www.msnbc.msn.com/id/37444899/ns/business-the_new_york_times//from/ET

 

[kaytieeldr]

This type of modification does not beg for a lender’s permission but is delivered as an ultimatum: Force me out if you can. Any moral qualms are overshadowed by a conviction that the banks created the crisis by snookering homeowners with loans that got them in over their heads.

They're kidding, right? You mean - using the couple in the opening paragraph - you can be intelligent enough to run a business, purchase a boat, shop for and buy a house, live well... but naive enough to be "snookered" by a bank when it comes to the mortgage? Really? :rolleyes3

 

[bicker]

Heh! Really!

 

[mamamia2]

These people are disgusting.

I have a hard time believing that they got "snookered"

When my DH and I bought our house I was 22 yrs old and my DH was 25 yrs. old. We hired a lawyer to look over the mortgage than we (well, really my DH) read every word in our mortgage contract and the things we didn't understand we asked about, we asked questions - even ones that might have seemed stupid. When we bought our house in 1988 the interest rate was something like 11% (we refinanced once at a lower rate, which was a huge headache) and we have never been late with a payment.

I just dont understand people sometimes. It makes me mad that these people and others like them will get away with this.

 

[2Kds2K9]

That's just wrong! Hopefully, there will be repercussions down the road for them. So tired of people taking advantage of the broken system.

 

[bicker]

Yet I have to wonder how many people would congratulate them, or at least admire them, for "sticking it to the man", or otherwise relish the fact that a "little guy" got one over.

 

[pyrxtc]

to own a boat and a business and not be able to pay your mortgage is just wrong. It means you are not running your business very effectively to sustain itself and pay you enough to pay your mortgage. yes, the mortgage company should not have let them refinance to buy a "prize truck" but the owners are ultimately responsible.

I have a close friend who hasn't paid her mortgage in months since the bank would not work with her at all. Their version of helping would have raised her monthly payment by over $300. She needed it lowered, not raised, she couldn't afford it as it was. She works part-times from home, he worked 2 jobs and they don't do vacations or any extras. They don't have newer cars and get help from assistance with some things like heat and baby formula. They have four kids, work hard and their house is sinking into the ground. It needs a good $40-$50 thousand dollars in work (at least) and their septic needs moving and replacing.

Some people really need the help and their lawyer said to stop paying. They now have money to pay rent on a place, as soon as they find one. Their house goes up for auction very soon but will be a hard sell. The only good part is that buyers will not be able to inspect the property first so they won't know everything that is wrong with it. Hopefully they get it very cheap cuz it won't be worth it otherwise. If her house could sell, she would have sold it already.

Some people didn't put themselves there. jobs get cut and houses need essential work which requires a second mortgage. Bills need to get paid for every day life and sometimes people get over their heads. They do everything they can but get no help.

 

[LuvOrlando]

What a mess. I don't feel bad for anyone involved. I don't feel bad for the people who couldn't be bothered with thinking through the in your face reality of interest only loans and I don't feel bad for the investors who created these financial vehicles. The investors (via banks and mortgage companies) created the interest only loans which fueled the 'flipping craze' speculation on homes, which caused a false increase in demand which increased supply which caused all the housing values to plummet. The poor who don't belong in houses to big for them are a much smaller problem then the fact we have too many houses and not enough people with money to live in them, that's why the people in foreclosure are allowed in their houses so long. Here is the current dilemma #1, who will buy the house from the bank & #2, all the public housing is already spoken for so where are the States supposed to put all the newly evicted? The only people I actually feel bad for are the regular people who minded their own business and will be stuck paying for both the bankers bonuses AND the freeloaders grrrrrr Nothing worse than cleaning up someone elses mess

 

[Jennasis]

I have a cousin who has been in "foreclosure" for almost three years. He has not paid his mortgage in almost THREE YEARS. They are "about to be tossed out on the street" every couple of weeks...then they file some paper work to get some extension, pay a couple hundred bucks and get a few more weeks in the house.

It's a dang crime IMHO.

 

[Carly_Roach]

A growing number of the people whose homes are in foreclosure are refusing to slink away in shame. They are fashioning a sort of homemade mortgage modification, one that brings their payments all the way down to zero. They use the money they save to get back on their feet or just get by.

This has been going on in Michigan for years. It's getting to be so common that the stigma of foreclosure and/or bankruptcy is no longer there. Where you used to worry about whether or not you could get into an apartment with these incidences on your record, people are now finding that apartments are welcoming these former homeowners with open arms; especially since the payments for an apartment became lower than the payments on a house. The apartments found that they got families who paid on time and took care of the place rather than youngsters who had bad reputations for both paying on time AND trashing the apartments.

Times change. People change with them. And all the dunning, throwing up your hands in horror, and judgment calls aren't going to change a thing. The only thing that will help the situation is better jobs and more hope for the future. Right now we have little of either. So you can expect to see more stories like this in the news. You might also be surprised to find that you're likely to know one of these former homeowners in your real life; they're just keeping it on the down-low around you.

 

[tomthebarncat]

These kinds of stories make me glad that I do not contribute to the US tax base. The Germans do not spend tax euros foolishly and would never allow this kind of crap to happen. A perfect example of the dummification of America!

 

[bicker]

The Germans do not spend tax euros foolishly and would never allow this kind of crap to happen.

I'll be sure to share this comment with my German colleagues. They'll get a good laugh out of it.

 

[luvmy3]

People like them make me sick

 

[kawing123]

In my neighborhood, many people have scored many toys such as motor homes, a third car, ski doos, snowmobiles etc by taking out huge mortgages for more than they paid for the house during the fake upswing in home values. These same people are now in foreclosure or have had modifications. These people are con artists. I suspect one couple who took out a home equity line of credit many of which you do not have to say what you are spending the money on. They bought a very modest home nearby and subsequently foreclosed on the original property maybe with the new home being free they can now afford everything they wish they could. Or the couple who paid 200,000 for their brand new home and subsequently refinanced the home for well over 300,000 and probably walked away with their brand new RV. In my neighborhood, this is the norm and quite frankly someone should take criminal action against anyone who uses the situation for these purposes. Since when have people thought it was okay to buy motorhomes, fifth wheels, fancy pick up trucks and other toys or home improvements and figure they will not pay or try for a modification? This is unreal.

 

[allison443]

Yet I have to wonder how many people would congratulate them, or at least admire them, for "sticking it to the man", or otherwise relish the fact that a "little guy" got one over.

The linked article originally appeared in the New York Times yesterday. The Times has a comments section on their website. I only got through a few pages of the comments, but it seemed that a majority of the ones I read had the attitude you describe.

 

[Nancyg56]

 

[Pugsley]

One of the things that made me the angriest about that article was this:

“Both generations of Pembertons have hired a local lawyer, Mark P. Stopa. He sends out letters — 1,700 in a recent week — to Floridians who have had a foreclosure suit filed against them by a lender.
Even if you have “no defenses,” the form letter says, “you may be able to keep living in your home for weeks, months or even years without paying your mortgage.”
About 10 new clients a week sign up, according to Mr. Stopa, who says he now has 350 clients in foreclosure, each of whom pays $1,500 a year for a maximum of six hours of attorney time. “I just do as much as needs to be done to force the bank to prove its case,” Mr. Stopa said.
Many mortgages were sold by the original lender, a circumstance that homeowners’ lawyers try to exploit by asking them to prove they own the loan. In Mrs. Pemberton’s case, Mr. Stopa filed a motion to dismiss on March 17, 2009, and the case has not moved since then. He filed a similar motion in her son’s case last December. “

The whole thing just makes me sick. I don’t get how people can totally dismiss that fact that THEY agreed to a price for the house and signed a contract. That doesn’t go away just because your house is worth less now. Can you stop paying your car loan because your car isn’t worth what it was when you bought it? It’s theft, plain and simple.

While I still think it’s wrong, I can understand doing it if you REALLY can’t make your payments because of unexpected medical costs or job losses and the bank won’t work with you and you have nowhere to go. But these people who brag about the other things they can buy now are disgusting.

 

[eliza61]

Yet I have to wonder how many people would congratulate them, or at least admire them, for "sticking it to the man", or otherwise relish the fact that a "little guy" got one over.

A whole lot of people. Face it, we (society) have fostered an atmosphere of "bigger is better", "buy now, pay later" and " I deserve it" for the last 20-30years. So of course it's the big, bad banks fault, why should I have to suffer for the next 10 years.

And the problem is I really don't think we've learn any lessons. I think when the economy bounces back, we'll be back to our free wheeling spending ways.

I went to a bridal shower last summer for my neighbors son. He's 23, she's 23. they were trying to collect money to buy a 3500 sq ft house. When silly me tried to point out that by the time they finished with property taxes, their mortgage would be ~1800/bucks a month, I was told they could "grow into" the house. Really?

 

[tonilea]

I just don't get the "it's worth less than I paid for it argument". Almost everything we buy is worth less than we paid for it. New cars lose value the moment it leaves the lot. Your clothes are usually not worth what you paid for them once you wear them.

 

[gottaluvPluto]

I just don't get the "it's worth less than I paid for it argument". Almost everything we buy is worth less than we paid for it. New cars lose value the moment it leaves the lot. Your clothes are usually not worth what you paid for them once you wear them.

When a person buys a home they are most likely looking at it as an investment. They don't expect to lose money from it.

Also, we are in for a rude awaking because nothing has changed in a certain area of the mortgage crisis. It will fall harder the second time.