KCM Blog

From the category archives:

Walking Away

Will the Government Help Pay-Off YOUR Mortgage?

August 6, 2010

We reported (see below) on a Reuters article saying there was a rumor spreading from ‘Washington to Wall Street’ that the government was considering major cramdowns on the mortgages of ‘underwater’ homeowners. The World Street Journal reports that the rumor is just that – a rumor. Share

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Walk Away and Fannie Mae Will Chase You Down

July 16, 2010

Many lending institutions are beginning to take action against those who decide to walk away. Fannie Mae, according to an article in Housing Wire, announced: Borrowers who are determined to have the ability to make their monthly payments but walk away from their homes will not be able to secure a Fannie Mae backed mortgage [...]

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A Conversation on Short Sales vs. Strategic Defaults

July 9, 2010

I recently had an email conversation with a well respected real estate professional about the difference between strategic defaults and short sales. We both agreed that we needed to share our conversation with the readers of this blog. Original Question: I have heard that a short sale might be better than a strategic default. However, they are painfully [...]

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Walking Away: The Impact on Housing

June 29, 2010

There is a growing trend in this country of people walking away from their mortgage obligations. The definition of a ‘walk away’ borrower is one who has the financial means to continue to make their mortgage payment but decides not to. This situation is also called strategic default. The incidence of people taking this path [...]

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Those Who Walk Away Could Be Penalized

June 17, 2010

The number of people ‘walking away’ from their mortgage obligations has reached epidemic proportions in this country. Strategic defaults account for 31% of all mortgage defaults. Walking away from an underwater house may seem like the easiest way out of the financial burden created by your monthly mortgage payment. And it looked as though there [...]

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What Exactly is a Strategic Default?

April 7, 2010

There is more and more conversation regarding strategic defaults. And that only makes sense since the number of borrowers deciding to take this path is increasing exponentially. What is a strategic default? Let’s first define strategic default in simple terms. According to Wikipedia: A strategic default is the decision by a borrower to stop making [...]

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Has It Become Stupid NOT to Walk Away?

March 2, 2010

Yesterday I posted on the latest Negative Equity Report from First American Core Logic. In that post, I quoted the report as saying that one of the ramifications of negative equity is that it is: a major factor in changing homeowners’ default behavior. That change in behavior could take on many different forms. One of [...]

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Built on Jenga Blocks, Home Prices Look Shaky

February 2, 2010

The Homebuyers’ Tax Credit, in many ways, has done exactly what it was suppose to do – stimulate the economy. Notice I didn’t say increase home ownership. The tax credit was never really about buyers. It was about keeping home values stable so the housing sector would not have another wave of foreclosures that would [...]

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The Cost of Walking Away

January 29, 2010

There is a very interesting cultural change taking place throughout the country. And it is the direct result of the current challenges in the housing sector. It seems that there is a wave of support for the concept of walking away from your financial obligations in regard to your mortgage. The stigma attached to those [...]

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Walking Away from Negative Equity

January 22, 2010

Today let’s look at negative equity and attempt to determine what impact it will have on a housing recovery in 2010. Negative equity, often referred to as “underwater” or “upside down,” means that borrowers owe more on their mortgage than their homes are worth. Negative equity can occur because of a decline in value, an [...]

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