freedomatlast
Thinks s/he gets paid by the post
- Joined
- Oct 27, 2013
- Messages
- 1,190
Wow. After reading some of the posts here, I am wondering if there are some that would teach their kids that it's ok to steal from a thief.
Wow. After reading some of the posts here, I am wondering if there are some that would teach their kids that it's ok to steal from a thief.
....So thief's should get away with stealing then?
Yes. Banks will stab you in the back and charge you for cleaning the knife. But knowing that, why would you believe a banker when they say you can loan up to some ridiculous $ amount. Just because a bank will give you a loan for a huge house doesn't mean you have to go for the trap. Some people are naive enough to take the bait, and others figure they will just bail on the deal later. When the banks give you too much for a loan, it's not free money. Everything has a cost. What about not taking the deal and just borrowing the minimum amount possible, even if it means no McMansion for you? To me, that is where the ethical behavior starts, and it may avoid having to do things in self-defense against the banks later, like strategically default.
so that if one of us became unemployed, we could still afford the house.
And I would never do business with someone who doesn't keep their word. Fool me once, shame on you... fool me twice, shame on me.
So you have no accounts with any of the major banks? Cool!
Funny how you rationalize what you did my blaming the lenders.
I don't blame the lenders, per se, but I'm just saying I'm not going to be the only honest guy at the table. The lenders aren't as pure as the driven snow or boy scouts either, generally speaking, so I'm just saying I wouldn't feel bad for them. At all.
Do you live in a recourse state?
Yup. No issues with deficiency judgments. Don't believe the hype they tell you to keep consumers in line.
so that if one of us became unemployed, we could still afford the house.
[/QUOTE
The flip side of that, which DW picked up on, is that also allows one person to ER, like at 56 in DW case.
Your DW is smart.
We both retired at 56, and the house is fully paid for, which would not be the case if it had been 1MM.
Where did I say that? What is the fraudulent act? Defaulting on a debt is not fraud. Down the slippery slope we go. Here's the difference, the banks actually comitted fraud, perjury, on a massive, coordinated scale. False swearing is actually a felony, crime in all 50 states.
No borrower is required to damage the financial position of themselves or their family by continuing to pay on a mortgage if defaulting on the loan leaves them better off (after all the enforcement actions are considered--damage to credit rating, seizure of assets, etc). If the banks wanted better defenses against this, they should have asked for greater guarantees or charged more for the loans.
Things are very different for a loan from a friend, etc.
The borrower still owes on the mortgage even if the home drops below the value of the loan. Different mortgages and different states vary as to the "recourse" available to the lender--the assets owned by the borrower that a court can seize and pass to the lender to satisfy the loan.In this unfortunate incident, the value of the collateral (the totaled car) has dropped below what the lender can recover from, but the consumer still owes the title company the value of the debt - so why isn't the consumer still liable for repaying the car title loan as much as they are obligated to repay a house title loan?
I am not understanding the vitriol. A contract is a contract--no less and no more. It places requirements on all parties, and contains measures that go into effect if either party defaults. In a strategic default, one party elects to allow these enforcement actions to go into effect. It is not fraudulent, it is not illegal, it is not morally wrong. Both parties signed the contract and agreed to the stipulations (and available enforcement actions) as being in their best interests. The borrower can elect to default at any time, and then the enforcement actions go into effect.
Now, if one of the parties commits fraud, then that is a different matter entirely.
The "banks are bad" line of reasoning is a dead end, and distracts from the issue. It doesn't matter what we think of banks in general, and their behavior, in general, is totally irrelevant to the case at hand. If a particular bank defrauded a particular customer, then that customer should seek a remedy against that bank (to include nullification of the mortgage contract).
No borrower is required to damage the financial position of themselves or their family by continuing to pay on a mortgage if defaulting on the loan leaves them better off (after all the enforcement actions are considered--damage to credit rating, seizure of assets, etc). If the banks wanted better defenses against this, they should have asked for greater guarantees or charged more for the loans....
Things are very different for a loan from a friend, etc.
Thank you samclem. Very well stated indeed. I had just been drafting my position on this issue. But after reading your post, I'll just hit the delete button, and add an enthusiastic +1.Originally Posted by samclem View Post
I am not understanding the vitriol. A contract is a contract--no less and no more.
Agreed - you took the words right [-]out of my mouth[/-] off my keyboard.
-ERD50
+1 as well. Do all you moral crusaders read the contracts you enter? Do you expect anything other than the terms that are in the contract to be the terms of the deal?
I agree. The contract is the contract. What I find hilarious is when defaulters whine over being denied their next loan due to the default being on their record. Or when their tears flow because a lender is able to negotiate a judgement against them requiring them to pay or have assets seized when the terms of the judgement were part of the loan contract.
Going back to OP's original post, I'm glad to see that terms of the loan contracts are being enforced to the full extent allowable in the applicable jurisdictions. If this means seizing assets, downgrading credit ratings or whatever is possible under the terms of the contract, that's what should happen.
If the lender wishes to exercise all the rights they have when a default occurs, that is their right.
I have spent almost all my adult life either in CA or WA, and you can be sure that the first thing I made myself comfortable with was the laws regarding recourse on mortgage loans.