Who is walking away from a house ?

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Replied by FrankN on topic Walking away from a house is a last resort

Aggressive moves, but smart! I am sure that couple is much better off today.
2 years 6 months ago #1

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Replied by Lexie on topic Walking away from a house is a last resort

Goldbug wrote: The couple I know who did that moved from a large house into a single bed apartment, which reduced their bills and left them paying a much lower rent than the mortgage. They also sold most of their furniture and personal items and let the house unfurnished through an agency, which gave them a nestegg to pay down the worst of the bills. While there was a slight shortfall between the rental income after costs and the monthly mortgage payment, paying that gap plus their much lower rent was within their means, while paying the entire amount was not. They lived that way for a couple of years until they had got things sorted out.


What a great idea. Your couple had the "gumption" to get it done. Many do not. Has anyone considered bankruptcy? This will also ruin credit ratings for about 7 years but would allow a person to stay in their own home and most likely have a much lower payment.
2 years 6 months ago #2

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Replied by Goldbug on topic Walking away from a house is a last resort

The couple I know who did that moved from a large house into a single bed apartment, which reduced their bills and left them paying a much lower rent than the mortgage. They also sold most of their furniture and personal items and let the house unfurnished through an agency, which gave them a nestegg to pay down the worst of the bills. While there was a slight shortfall between the rental income after costs and the monthly mortgage payment, paying that gap plus their much lower rent was within their means, while paying the entire amount was not. They lived that way for a couple of years until they had got things sorted out.
2 years 6 months ago #3

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Replied by Wanderer on topic Walking away from a house is a last resort

Remember maintenance. upkeep and compliance with building, zoning and fire codes. Also remember the tenant that trashes the place. It seems like a good idea but ... ?
2 years 6 months ago #4

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Replied by FrugalFran on topic Walking away from a house is a last resort

Renting out the house in question and moving into a small rental is an interesting idea in theory, but the rental income would have to cover at least the mortgage and taxes, if not the small rental too, depending on the family's circumstances. I'm curious to know if anyone here has done this or knows someone who has done it.
Last edit: 2 years 6 months ago by FrugalFran.
2 years 6 months ago #5

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Replied by Tishbel on topic Walking away from a house is a last resort

smcc wrote: So do you go the forclosure route, stop paying the mortgage, save that money until your forced to leave, take the hit on your credit score, find an apartment for a few years and re-enter the housing market at a later time ? Do you continue to pay your mortgage in the hopes that things might turn around and the "sting" won't be so bad ?

Simply stopping paying the mortgage would destroy your credit rating. In this situation, wouldn't it be better to talk to the bank and see if you can arrange to refinance it or alter the payment arrangements? Walking away from a house is a big decision, and I don't know anyone who has done it willingly. Options they've tried first include refinancing, making an arrangement with the bank, extending the mortgage length, getting a lodger, moving to a much smaller rental and letting the entire house, etc. all because getting back on the property ladder after a foreclosure is extremely hard.
2 years 6 months ago #6

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Replied by FrankN on topic Re: Who is walking away from a house ?

Looks like he is going to be. Will be interesting to see this play out.
2 years 8 months ago #7

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Replied by FrugalFran on topic Re: Who is walking away from a house ?

It will be interesting to see what changes will come out of the Trump administration, especially if Dr. Carson become the HUD secretary. He seems like an odd choice for the role, but I think he would do a good job. If they can cut some of the redundant spending in that department, I think they could help a lot more people.
2 years 8 months ago #8

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Replied by FrankN on topic Re: Who is walking away from a house ?

unfortunately it puts that family in a very dire situation. Banks do not tend to have hearts or compassion. I hope they can get back on their feet and their extended family can help them out.
2 years 9 months ago #9

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Replied by FrugalFran on topic Re: Who is walking away from a house ?

So true, Frank. My question is what happens when the bank finally takes the house and you don't have enough money to get another one? I know one couple who has no savings and if they lose their house, they won't even have money for a deposit on an apartment. What happens in that case?
Last edit: 2 years 10 months ago by FrugalFran.
2 years 10 months ago #10

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Replied by FrankN on topic Re: Who is walking away from a house ?

Very sad situations and tough thing for a family to handle
2 years 11 months ago #11

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Replied by FrugalFran on topic Re: Who is walking away from a house ?

I know a few families that are in foreclosure, but they aren't "walking away." They are still trying to do everything they can to stay in their homes. It's really a shame that so many people are still in this situation and have to live in fear of becoming homeless.
3 years 2 weeks ago #12

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Replied by Breakinger on topic Re: Who is walking away from a house ?

I know a few people that caught up in this a few years back and a lot of them weren't happy that they made the decision to either walk away or foreclose on the property. I know that my house isn't worth what I purchased it at either, but I wouldn't want to give it up because it's mine and it's a roof over my head.
3 years 2 weeks ago #13

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Replied by hanna on topic Re: Who is walking away from a house ?

If it's me, I don't see any reason to walk away. It's already my house even if it's still unpaid. :innocent:
9 years 2 months ago #14

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Saw the title "Who is buying a house?" and had to post the reverse. Ok, youi purchased a house some years back and your mortgage was $500,000. Now because of economic reasons you house is worth $200,000. Do you walk away ? never been late on the mortgage, your credit score is pristine, but you realize that unless the economy makes a RADICAL turnaround, you will be throwing money into a black hole.

So do you go the forclosure route, stop paying the mortgage, save that money until your forced to leave, take the hit on your credit score, find an apartment for a few years and re-enter the housing market at a later time ? Do you continue to pay your mortgage in the hopes that things might turn around and the "sting" won't be so bad ?

Some say its a "moral" issue, some say its "dollars and cents"

and you say............ ?
9 years 3 months ago #15

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