Mindsets

[Jumbo101]

Is anyone having issues with trying to convince family members that walking away makes sense?

[Schnelle]

Not in my case, in fact my mom and sisters could not understand why I am trying so hard to keep my home when I can save $1000 each month by walking away and renting a comparable place.

[stryker115]

I've been surprised actually - family members we've told immediately think it's a great idea.

[KT in CA]

We have only told my parents so far. They say whatever is best for our family is the thing to do. And actually, the few friends that do know have been very supportive.

[spj3210]

Most of our family/friends can see why we'd consider it in our situation but I think at the same time some are irritated b/c they'd like to walk away too but wouldn't do it for various reasons (mostly credit reasons).

[dedwards]

My family have been very supportive of it they all seem to understand that it is a decision to save my family. I think my wife has more an issue and it's mostly emotional with this whole deal. I have not had any really bad reactions to this though a few people you talk to have the 'you can't walk away' mindset, but I did too until I looked it it from every angle and saw that the only choice was to walk.

My 1st and 2nd payments came to about 2900 a month. with a reduction in pay I took and increase in insurance premiums I ended up with a 800 dollar every month shortfall after cutting back everything I could. Houses that are the same size and areas of town as my home rent for about 1300-1600.So it is clear that I have to walk. Also I tried a long time to save my house and used up my savings to cover the shortfall I wish I had not. Everyone has been supportive but even if they had not I know I made the right choice it was not a knee jerk reaction.

[Jumbo101]

The argument against it seems to be , why walk when this is the place we wanted to live in. The rationale seems to be if you could make the payment 2 years ago , why not now. Im having a hard time convincing some that it might make financial sense and that being able to refi in 5 years might not happen. I appreciate all the responses

[dedwards]

Well the thing is refi is not really possible if you owe 325,000 and the house value is 120,000. So maybe try to explain that to them. Even if we could make the payment now the value in our homes are not going to be going up anytime soon. I think the floor will come about in 2011. The thing people fail to see is that as in past trends a market floor will stay for 4 - 6 years so you are talking 2015 before prices go up and then how fast till it goes over your loan value ( some people talk like someday some one will say burst is over your home is not worth what it use to be 'snap'. ). The hit you are going to to take to your credit score will be bad but in 7-10 years you should be right back to where you were. Your score will actually start to go back up slowly right away. And in 7 years when it is gone from your report you can buy another home at the rock bottom prices or not.

Do a calculation as to what you will save renting compared to your home payment + taxes and other expenses minus tax benefits of owning, and you should see clearly weather walking is right for you.

[ClueLess]

Really...you dont have to explain yourself to anyone (even family members)...they are not the ones who's paying your mortgage, property taxes, cars, insurance, kids, gas, food, etc...you do what's right for YOU and only you. who cares what anyone else thinks

[LeavingAZ]

my family is amazing.

[strive2win]

Originally Posted by ClueLess

Really...you dont have to explain yourself to anyone (even family members)...they are not the ones who's paying your mortgage, property taxes, cars, insurance, kids, gas, food, etc...you do what's right for YOU and only you. who cares what anyone else thinks

So true!!!

[cc123]

I'm bouncing between holding on and walking away every few minutes. I was set on walking until I started looking at rentals in a better area. It'll cost us about the same if not a bit more than our mortgage.

I know eventually we will have to walk because the Debt Relief Act will only last till 2012. After that, walking away will costs us even more. It's really depressing. I guess the sooner we walk, the sooner the credit will be rebuilt.

[Jumbo101]

Clueless I understand what you mean but, when part of the family is your wife it changes the disussion a little, know what I mean?

[ClueLess]

Originally Posted by Jumbo101

Clueless I understand what you mean but, when part of the family is your wife it changes the disussion a little, know what I mean?

ooohh, ur wife? sorry, thought u were talking about other family members. well me and my hubs were at odds at one point. we jus have to continue talking about it and keeping the communications line open...and come to an agreement. Eventually, we were able to make to agree upon a final decision. good luck! at least, u found this forum filled with lotsa info and support.

[kymburley]

Nope. My Mom wonders why I continue to try to make the payment. Our payment is 2/3 of our income and we have student loans, food, etc and we still try to pay. Not only that but we're underwater, and to her it's stupid to keep dumping money into a place where it will never be recovered.

[ORNV3]

I have been SHOCKED by how supportive every single person I've told has been. I can't believe it.

[cactus77727]

Interesting topic. About August of last year I had trouble convincing everyone about me walking on my house, and the economy in general.
I remember a good friend took me out for a drink during the Olympics. I said to him, I don't understand it, but the economic numbers are insane. I said, I have a feeling this is going to be serious. At the time, he thought I was nuts. He doesn't feel that way now. He's working his butt off trying to keep job.

Last year my relatives also thought it was a mistake to walk. I had to convince one relative who offered to pay my mortgage for me. I'm glad i didn't let them waste money on it.

They all know I'm doing the right thing now. As the house values continue to fall closer, and closer to their balance owed, others are starting to understand too.

Still, I have some cousins who are spending like there is no tomorrow. They said they want to buy a second home. I tried to tell them to wait a while longer.

[nana8]

Hi all-
There are still some, maybe even alot, of people out there that can not concieve of walking away from thier home. People....like my brother-in-law...who have a great job, great credit, a very affordable mortgage, and last but not least....still have $100,000 equity in thier house. He has been living in denial. I think I burst his little bubble yesterday when I tactfully pointed out that housing prices in HIS area have dropped 26% in the last 4 months.....he had no idea. After he checked to see if that was true, he called me to say he was sorry for his own ignorance....he was shocked to know how much his house was now worth....through no fault of his own......there in lies the point. We are NOT walking away just because we feel like it, we are doing it because we are left with no other choice!
Good luck to all

[markmc2000]

Nana. Good point. some people are living in a vacuum if they don't have to sell a home and still have a good paying job. Denial runs rampant, but one has to do what he believes is right for his own situation.

One thing I have a hard time grappling with is some people are living in tent cities, or the woman who drives a lexas is now living in that lexas becuase her real estate business has dropped off a cliff. Sad state of affairs.

However! things Will get better, jobs will come back (probably at lower pay levels), and people need to adjust to the new reality that standards of living are coming down. Everybody in the world has to compete for resources and jobs.

In my mind we are in a global shift where the world just got much flatter due to technology and the rise of many developing countries is putting pressure on resources. This puts downward pressure on developed countries.

Nobody is going to go hungry, but many people will have to learn to enjoy the simple life. Like spending time with family, hiking, doing crafts at home, cooking homemade meals. Simple stuff that is still enjoyable, but not not real glamorous compared to what we watch on TV.

I'm just trying to keep my health good and everything else is just icing on the cake.
Time to pull up our bootstraps people and adapt to the new realities!

[markmc2000]

Originally Posted by ClueLess

Really...you dont have to explain yourself to anyone (even family members)...they are not the ones who's paying your mortgage, property taxes, cars, insurance, kids, gas, food, etc...you do what's right for YOU and only you. who cares what anyone else thinks

Clueless. I get your point. Take care of your financial health because you have to pay the bills. However, I'd be careful this type of statement doesn't get mis-interpreted.

I'm concerned that Americans have developed an attitude that says take care of yourself and the heck with everyone else. Which comes from our cut-throat capitalism we have developed over the last 30 years. One that is total survival of the fittest to the point we have resulted in cannabalism when it comes to ones personnel fianancial health. Mainly from CEOS thinking.... I sell the heck out of these mortages that I know that can't be repaid. Won't make any difference because "hopefully I be retired and rich by the time this house of cards falls"

I sure hope we can get back to what really matters.

Mark

[nana8]

Markmc2000-
Now that I have come to terms with .....most days.....the inevitable loss of our house, I am looking forward to living the simple life. We are lucky in that we know where we are going from here and we can afford it. It is like starting over, but I'm okay with that....I always enjoy a challange. With 6 kids and grandchildren #7 & #8 on the way this fall.....you could say my life has ALWAYS been a challange. We have made it this far.....we will pick up and move on. Inner peace is a wonderful thing, espically in a crazy world

[ClueLess]

Originally Posted by markmc2000

Clueless. I get your point. Take care of your financial health because you have to pay the bills. However, I'd be careful this type of statement doesn't get mis-interpreted.

I'm concerned that Americans have developed an attitude that says take care of yourself and the heck with everyone else.

I sure hope we can get back to what really matters.

Mark

i get ur point too, but I was only referring to the subject matter at hand which is...making the decision to walk away. some of us dont have the means to look for help in every little nook and cranny. if we cant help ourselves and take care of our own mess....who will???

*note*pls. do NOT mis-interpret any comments i make LOL!

[cactus77727]

I disagree with the notion that people will not go hungry. Many people were already on the edge, even before the global meltdown started.

My retired mom used to be a kindergarten teacher in one of the poorest schools in downtown Phoenix. She had to keep breakfast cereal in the classroom because sometimes kids would come to school without having eaten breakfast!!! She would ask them why? Because their family didn't have any food that day. And this was years ago.

I have a relative that is now sponsering a lady with two grandchildren, whose daughter left her with the kids. They were turned away from various social services due to capacity. Private individuals offered a place for them to stay, and my relative, along with a group of other people, are helping provide food.

The food banks simply do not have enough food. Demand will be rising exponentially. The numbers are simply not sustainable.

I saw an article last year that blew my mind. Already, global food crop demand outpaces production. And, the United States eats most of it. (google: The Future of Food: How Science Will Solve the Next Global Crises -- Wired Magazine)

We all need to adjust our mindset. The days of easy living are over. I think I'm still in denial myself. I'm not yet prepared for what's coming.

[RimToRimHiker]

In the economic climate we live in today, the stigma that used to be associated with foreclosures and repossessions is quickly passing. I don't walk around with a sign saying "hey I'm walking away from my underwater albatross" but with the housing/mortgage crisis affecting so many people, it's definitely a subject that comes up a lot. It is surprising how many people are facing the issue personally or know someone facing it. With the exception of one friend, who lives and breathes by her FICO score, most understand it's a good business decision on our part and respect our decision to put our own financial well being ahead of all else.

[stryker115]

I have spoken with a couple people (non-family) who consider it morally wrong that we want to "walk away". They know it is a sound financial decision and what's best for our family, but believe it will affect everyone else (which I guess it will, in a way) when they pay higher taxes and such.

Honestly I can't argue with that - I have always tried to be responsible and live up to contracts I have signed. We made a poor decision and are able to get out of it in some capacity ; others aren't so lucky.