Strategic defaults on mortgages are they right or wrong

There are always going to be a few who take advantage of situations.  It still hurts their credit.

My stance is that the lenders might need to look at their systems and see if a "strategic" default could be avoided.  I'm amazed that the lenders are letting paying customers walk while bailing out those who don't.  Why not concentrate their efforts on reworking the loans of the owners who haven't missed a payment but have an adjustable rate loan about to come due.  Why not freeze their rate without a refinance?  I've had multiple clients who have tried to refinance or do a loan mod who have been refused because they don't have a finacial hardship.  Talk about a bad business decision on the lenders part.  Give em a DUH award.

I have to believe at some point is shows you the integrity of the individual.  Years ago I had a terrible time when I got sick and had trouble keeping up.  It was a struggle that took several years to correct, but we did not walk away from it.  It did not matter that I was deathly sick. Ellen had to go our and work.  It was the right thing to do.  It is called being responsible for our own actions.

Today I see people that are not even in a home a year, and want to sell it because they got tired of it.  Give me a break.  We wonder why America is in a Depression?  Lack of common sense, personal integrity, and our apathy towards events and politics were probably the starting points.

Russ, neither do I judge... we each need to walk in our own shoes and I've never been there. 

Strategic defaults on mortgages would seem to make sense for middle class homeowners.  Do you expect middle class home owners to use up their retirement, children's college money, health care savings just to postpone the inevitable for a year or two. Should they sell their furniture and every other asset to try to satiate insatiable banksters? Shouldn't they get out while the still have some assets to survive on? Who is going to help them once they are completely tapped out-You? What did they pay thousands of dollars in mortgage insurance premiums for at closing and for every month thereafter?  Banksters are amoral. They got almost 95% of the PI payments as interest.  They got mortgage insurance. Ain't that enough? The middle class are on their own. They should treat debt and contractual obligations like the wealthy and corporations do.

Just read an internet article that banks are now more agressively going after former owners on both defaults and short sales.  Seems there are two parts to a short sale which often are not completed.  First is getting the lender to release the property for sale at below loan value.  However, many don't complete the second part of having the lender forgive the difficiency created, which can be pursued at a later date by the lender.  It appears that lenders are now tracking short sale and default borrowers who may have the ability to pay or assets to levy.  This greatly exposes those who do strategic defaults for years thereafter. Also, lenders can sell defaulted loans to collection agencies which can then pursue the former borrower.

Strategic Default is an acronym for cowardice.  If one is an ostrich - then stick your head in the sand.  If you are a responsible individual - do a Short Sale - unless your legal and tax advisors tell you to do otherwise.