Is it ethical to walk away from an obligation just because the market changes? This economy has forced a lot of good people into default because of a hardship such as loss of job, divorce, medical bills, loss of ability to obtain credit and loss of income. There is a safety net for people who have these kinds of hardships.
But there are a lot of folks that could make their payments have just decided that it is not in their best interest to continue to make their mortgage payments.
This has become so prevalent that we now have a new name to for it. It is called Strategic Default. . According to Experian Strategic Defaults tend to more common with borrowers who have jumbo mortgages and in the second quarter of 2010, 30% of Strategic Defaulters earned more than $150,000. We don’t seem to get too concerned when we think the big banks are loosing money through default. What we fail to realize is that the Lenders are passing losses right on to rest of us.
My grandfather would not have used the term Strategic Defaulter for someone that failed to pay his or her just debts. He just called them deadbeats.<!--EndFragment-->