One of my pet peaves the lack of personal responsibility

I saw a lot of walkin in the 80's when interest rates were 17 and 18%.  At least the rates are low now.

ANd this all means lower home values which hurts everyone, especially those who had long-term strategies to sell and use their equity for retirement.  With the number of baby boomers hitting the retirement age - this has huge repercussions.  And not to mention no health care.

 We need to keep a positive outlook and encourage the real investors and homeowners with money to start buying to get us out of the mess.

It is unfortunate when homeowners lose. When investors lose it is is still bad but not as life changing!

Jay,

Have you read any of Bill Arce-Real Estate Latino- posts? He said he has heard of some Realtors are actually advising people to do just this.

The shakeout isnot over yet,hopefully situations like this will turn into opportunities for others.

Banks, for the most part, do not want to be landlords.

Steve

Jay,

I agree with Hugh...personal responsibility separates 'the men from the boys'! Thanks,   Fran

Hugh,

in some situations it doesn't even seem to be a consideration.

that's a shame.

June,

i was a lender in the 80's and i don't remember it to this extent. But you could forget about the purchases.

Mary,

 the retirement money is gone and so are the buyers who would be buying up. that's why there seems to be such a gap in the mid size properties.

Gary,

i agree, they're two different animals.

Obeoman,

no i have not i will search for him. i'm not a realtor, but as a lender i would never give that advice. if a client is at that point i suggest acquiring legal counsel.

jay

Its sad to see families literally walk away from their lives.  Makes me wonder-where do they go?  How many people are now homeless because of what's going on?

Fran,

onceagin, unfortunately for some not even taken into consideration.

Jennifer,

It's got to be tough even to rent, although here in southwest florida it doesn't seem to be a problem as we have plenty of rentals available.

imagine that.

jay

I think the banks should seek a deficiency judgement in those cases. If you have the ability to pay and you don't it affects all of us.

OK Jay...fully half the homes we are getting now are from homeowners.(investors).The have tried to hold on..but the market continues to fall here...I cannot tell you the amount of homes here, beautiful homes that just  sit...After the first of the year, there were tons of auctions...Most of the properties went back to the lenders...they got fixed up, got cleared titles, and are now on themarket for 20-30% less..We just bid on one that was a 2001 construction 1500sq ft, 3,2-2car on a corner lot, in a nice subdivision..from 195 to listied yesterday by the bank REO agent at 109,900....This is scary even to  me...I'm tempted to walk on my current holdings and buy the new stuff...

Just kidding..I want to just take a few weeks off and see what happens...Things are being listed for what we were being blasted as lowballing before!!!  Got investors...Call Mike

Michael R.

it would cost more to try to collect. but i do agree it affects us all.

Mike,

another florida guy. are we having fun yet?

just half from investors? i would have thought that number would be higher. some have so many properties and really do want to liquidate, so they can do it again at the lower prices.

jay

its sad how someone can lose there life long dream of owning a home for not being able to hold on for a few more months or a year.  i think the banks need to come up with something for this type of situation

most people that struggle is only temporary, and eventually they turn things around

my blessing goes out to all those in need of help.

Before anyone goes feeling too sorry for the financial institutions - they allowed these loans and a lot of them are unwilling to work with the homeowner - even if the it could work.  There is enough greed  to go around on all sides of this equation.  I haven't experienced much of this myself.  The area where I work did not have an abundance of subprime mortgages.  At least not like Florida or CA.

very well said. Investing has ups and downs, and many folks did not consider the downs. While I do not have compassion for greedy people, I do believe everyone makes mistakes, and deserves another chance in life. Sometimes, walking away is the only option for a good person who made a bad decision. Now...if they learn from it and don't repeat the mistake, great. If they do it all over again the next time the market gets hot...shame on them.

For some it's easier to do this. Why would you want to walk away from your investment. What sense does that make?

We are seeing some of that too Jay...but not a lot! I guess some have been kicked when they were down...one time too many!

Congratulations on your feature...way to go!

Hi Jay - we're not seeing very much of this in my area, although I do know of some. 

It is sad to see so many get hurt in this.  Those who weren't playing games, didn't lie on their applications, and actually had some money into the property - those are the ones I feel badly for.  Those who bought all kinds of properties by playing games and borrowing from Peter to pay Paul - those I feel no compassion for. We have a few 'mortgage brokers' here in my areas that did funny things with loans and sales contracts and bought all kinds of things - they're now losing all kinds of things.  I feel badly for their families because I'd bet they were totally aware of how their 'house of cards' was built.

Ann

Given the mobility of our society, at this point there are very few 'homeowners' left. 'Home' is no longer a descriptive term for the shelter in which we live. 'Home' is a much broader area with many choice in which one can reside. The world is not what it once was. There is no great attachment for a particular piece of land. If one can rent an identical house next door for half (or less) of the cost of one's mortgage payment, why would one not move? There are some reasons, but few of them fit the current economic conditions of most of the country.

When I drove through Cape Coral a few months ago there were more abandoned builders' models than I'd seen anywhere.

We have been lucky in New Hampshire so far in that the number of short sales and foreclosures is much lower than other parts of the country.  So far as I know all of my clients are in great shape!  I strongly encourage them to not over spend and to get a loan they can afford -- none got the "funny" loans.  So far so good.  I do feel sorry for those that were taken advantage of and I think the laws should be enforced and those who committed crimes should pay!

Thanks for the post.  It's really a shame it's gotten this way.

Good post--We're seeing this in just about every market, some more than others.  I do agree there are some really sad stories out there.  Just heard about one this week.

I hear Florida is taking some major hits, It will survive the storm as all markets adjust

Some homeowners who are losing their property need to stop blaming other people for their problem and take responsibility for their actions. Some people brought houses when they deeply knew in their hearts that they couldn't afford it. But hopefully everybody involved in the purchase and sell of a house will learn from this. Great post.

You know what ... I should talk about me NOT walking in 1982 when interest rates were 18% and I had to go to the closing table with cash.  I know how it feels.   Oh I loved that little home.  Great story, thanks!!

This is a sad segment of the business...  Accountability needs to happen.

David,

unfortunately for some they just can't afford their home, so they need to move on. there's just too much of it for the investors to deal with effectively,

Ruthmarie,

 i don't believe the banks did their due diligence, if they had many of these homeowners would not have had a chance for home ownership. that also would have included those who have made it through all this and are thankful for the opportunity.

Team Carroll,

they sure were having a ball when the market was hot. and i mean everyone involved. right up until things changed so quickly and everyone was caught with their pants down, so to speak.

Robert,

in areas like where i live (southwest florida) the properties are so far underwater they can't believe that it will ever recover.

Joan

for some it's just so overwhelming and has been going on for so long that they can no longer deal with it. for others they just don't want to.

thanks!

Ann,

we have had plenty of funny stuff. those involved were very creative. there's no way to see who is going to actually survive, but whoever is i'm happy for them.

Greg,

i agree that things have changed but we still have families that tried to settle down and now are uprooted. i feel sorry for the kids.

Sharon,

i live in the cape. you can get a great buy on anything associated with new construction.

Joan,

i was born in nh and lived there through the banking crisis. the fed closed the bank i worked in.

Audrey,

i agree. i truly hope that time does heal all wounds.

Diane,

we're really enjoying ourselves down here in southwest florida, but i do believe that it's improving. no joke!

Brett,

personally, i believe that we will never quit. we will persevere.

Lanre,

i agree that should see the error of their ways and then move on.

Karen,

it certainly was a different time. i believe you never thought of walking as an option.

Courtney,

accountability seems to be lacking, don't you think?

thanks everyone!

Jay

I agree with Hugh. Fortunately, this has not happened much in my area. Florida is really on a hole.

Jay, Lucky me i,m in so.cal and right in the middle of it and in my area we had a group of scammers who formed an investment group that purchased right at 200 properties with false(liars) loans then walked with millions in kickbacks ruining the lives of 80 people who fell for their ptch and invested with them.On the bright side since the first week in january the buyers who really want to own a home have been out looking(and buying)and all they want to see are REOs to get the best prce possible.Wrote an offer today for just such a family and their offer will get accepted.Thats 6 families this year that I have had purchase a HOME not a piggybank.

I heard a seasoned real estate professional calling this "Jingle Mail"...because people send the keys instead of their monthly paymnet!

I saw a recent episode of 60 Minutes on the mortgage crisis...there was a couple that could clearly afford the payment, but just didn't want to because they were upside down. YIKES!

Let your yes be yes and your no be no. Anything else is evil.

Jay- I am one of those investors with a house that hit the market just at the wrong time and I have really struggled. I've cut out the non-essentials so I could make the payments. I am frustrated and angry with the investors and homeowners that just walk away. When I signed the papers, it was my promise to pay and I'll keep it. In the meantime, I'm keeping my fingers crossed on an increase of conforming loan limits. Who needs fake nails anyway? :)

Its the families and particularly those with kids who this is the saddest for. They have to live someplace. Let us hope that things work out better in the future for them.

That is truly sad. I can't see leaving my home. Afterall, it is your credit you are playing with. Something like that stays for a long time. 

Wayne,

in our society today the issue of personal responsibility needs to be addressed. what kind of example are we setting for our children?

Cameron,

i feel your pain all the way down here in southwest florida. our markets will correct themselves and hopefully the families that benefit will surpass those who have suffered.

as for dishonest investors and their helpers.

off with their heads!

(not really, but it sure felt good to say it)

Joey,

i'm familiar with the term and it is catchy, but i think that many will not even spring for the stamp.

maybe we could call them "counter keys" where they leave the keys on the kitchen counter on their way out.

Jennifer,

"hats off to you!" and the loud statement you are making for responsibility at no small cost.

i'm afraid too many don't understand the meaning of the words "promise to pay."

Bob & Carolin,

may the families and children not suffer greatly and when the world turns may they be given another chance if they so desire.

Christy,

some have been eaten alive from the stress and strain and just need to make it stop.

others, just don't care.

thanks

jay  

I agree with David, there are so many families out there that have been effected where their situations are temporary, and now they are or have lost their American Dream.  I know a couple that bothlost their jobs in 2007, due to new ownership of the company, and they have picked up and moved on, however, they are having a difficult time catching up. People like them need someone to step in and help them hold on to their dream.

Rhonda,

you've got to hate seeing things like that happen. some people are caught up in the mess and while they might be able to correct the situation they probably won't get the chance.

Jay

in our society today the issue of personal responsibility needs to be addressed.

I agree with this - we (the people) have become a transient irresponsible society that craves and constantly strives to fulfill its lusts in everyway. Corporations are just made up of people and people need to change. Walking away from responsibilities seems to be getting to be the norm.

Kathleen,

unfortunately, there is way too much truth in your ststement.

however, change is always a possibility.

Jay

Great Post. I called on a past client about a month ago and explained that he was in a position where he needed to refinance and had plenty of equity, credit, etc. in order to get it done. His response was simply, nope we are just going to let it go. He said they knew all of the ramifications pertaining to their credit and future financial situation and they decided that they would just face the music. Needless to say, I was floored, but ....To each his own! It looks like they arent the only ones.

Tom,

somehow it just seems to people like it's alright. hope they CAN live with it later.

jay

It is a total shame how many people over extended knowingly and now claim it is not their fault. 

Jenniffer,

many want to believe that they can do it. unfortunately that doesn't make it so.

others are just trying to see if they can handle the costs of owning a home with the feeling that if they can't so what, they're walkin'.

Tom:  I think much of the blame for people walking away when they had other alternatives, even though it may have been tough, lies with the media and the constant news about how horrible the market is and all the foreclosures.  They are giving the impression that everyone is defaulting on their loan obligations and walking away, making it "okay" to do that. 

How about a few news pieces about how good the housing markets are doing in some areas of the country, how few foreclosures there actually are in those markets (here in the Richmond, VA, area foreclosures are 1 in 1103), and how great the interest rates are now for people who have taken care of theuir credit and have good scores.

Its terrible, I cant believe it has turned out like this. So many losing thier homes.Jessica Cordell

Jessica,

i can remember having conversations 2-3 years ago about these loans becoming a problem. i'm not really that surprised.

jay

Hi Jay,

It is a sad time in the housing market to see prices fall like they are.

Builders in Benson, Az are finding it challenging as well.

John Hurbon

Realtor

John,

it's a big time correction for some markets, and i'm in one!

jay