February 03, 2011

Home Loans in US: >$1M Strategically Defaulting

SOURCE: http://shloky.com/?p=3140

No moral qualms (though that garbage is pushed on the lower tiers with some gusto).

“I haven’t made a payment in two years,” he says. “It was business decision. It was an easy decision. I have a property worth six or 700,000 less than when I bought it. I was making payments of 10,000 a month.”

Means:

One in seven homeowners with loans over $1 million are seriously delinquent compared to one in 12 with mortgages below $1 million.

Easier to resell the cheap assets:

The more you owe, it seems, the better off you may be. Darren Thomas continues to live in his home because banks are often slower to foreclose on million-dollar homes.

“Banks are less willing to take those homes back because they are harder to move on the market, harder to sell and much more of an up-keep,” says You Walk Away Real Estate’s Chad Ruyle. “These properties come with maintenance costs.”

No comments: