Judge awards a couple thier home.

[JMJ]

No -- you're paying your loan as you agreed.

You can always sell, and that gets you out of your loan. Obviously, there is going to be some pain related to some bad choices you made - you bought into a real estate bubble.

I know this sounds bad, but honestly, if you had made a profit on the sale, would you have turned over the profits to the bank? Of course not - buying into a bubble is a gamble. Worse, the gamble you took (buying into the rising bubble) inflated the price spiral a little more, contributing to your own demise. Even if you take a loss, it's unlikely that the loss will be more than if you rented the house for 6 years.

The people who acted the MOST RESPONSIBLY -- those who didn't buy into the bubble -- are those paying the highest price -- having to fund the bailout of the banks, funding the bailout of some homeowners, and STILL facing an overpriced housing market.

I do find it troubling that banks are only willing to work with people ALREADY behind in payments, that's a very short-sighted policy that rewards the most irresponsible.



When I had a home loan, the bank also signed the contract.


You ARE aware that banks are going under right now BECAUSE they are on the hook for defaulted home loans, right?

They are going under because they don't have enough reserves. The larger banks are gobbling them up to recapitalize their over extended books. The big boys who are the real problem aren't loaning out to the smaller banks so they can recapitalize. So the FDIC goes in and shuts them down and sells them off to the larger banks for pennies on the dollar. Too big to fail is getting bigger. Some of those investment houses which have turned into actual banks have obligations of 100+ times their reserves. It's a big scam.

[Mike Cruz]

I do find it troubling that banks are only willing to work with people ALREADY behind in payments, that's a very short-sighted policy that rewards the most irresponsible.

This is not true. Of course the banks are going to once again make every attempt not to work with these people as they are making there payments as needed, but they can still definitely get a loan modification and/or refinance.

[JuniperPark]

OK, we sell our home. We have roughly $100,000 left in our mortgage and if we're extremely lucky we can get $50,000 for it (extremely high foreclosure rate in my neighborhood - roughly 20%). Are you telling me that the bank will just eat the other $50,000 left?

We bought during a bubble for a home to live in, not an investment property, not a vacation home, but as our only residence. We needed to move her because it was the only place my wife could get a job *and* my company would let me transfer to. It was either that or stay someplace she couldn't get a job.

This brings up another issue: Where shall we live now? We have no money for a down payment, we cannot rent (since rental prices have NOT dropped - we're looking at LEAST $1500 a month for a place much smaller than where we are now - let alone finding a place that won't give us a hard time about my wife's service dogs (yes, I know that is illegal but it still happens). Our mortgage payment is about $1000 a month now so it would just be more expensive for us.

Even in this scenario,, even using your numbers, had you rented instead of bought you would be comparatively $108,000 in the hole right now, and would never had a chance at a profit, and would not have had the interest deduction on your taxes.

I realize this is a tough situation and I'm not trying make it worse for you, but just trying point out you're really not far from where you would have been had you made other decisions.