Why? I don’t get it
I read an article that was essentially about people who are in over their heads on mortgages and how the new mortgage-relief plan might or might not help them. One thing jumped out at me from the article, mostly because I’ve been hearing similar statements a lot lately:
“I want to stay in my home – it’s perfect for me,” Martinez said. “But I don’t want to make payments on a $200,000 loan when my house is worth $70,000.”
Why does it matter what your house is worth now, if it’s perfect for you and you agreed to the price when you bought it?
Why does it matter if the houses around you are selling for half of what they were 3 years ago, if you don’t want to move?
I don’t think it’s acceptable to decide that you just “don’t want to” make payments on something you agreed to. And this is a big part of the problem, at least in this area.
I’ve heard people talking about how their neighbors walked away after buying a new house, because they got a larger house for so much less. I don’t think that’s right, and I think it’s a good part of the reason why housing values have dropped so much here.
I don’t get any of that. But mostly, I don’t get why it bothers people so much to be upside down on their house (if they have no plans to move) when it doesn’t seem to bother them one whit to drive a shiny new car off the lot and instantly be upside down.
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February 27th, 2009 at 7:30 am
You don’t get it because you’re applying common sense to thoughts from people that have none.
If they walk away from the home, then it wasn’t actually perfect.
February 27th, 2009 at 7:34 am
Exactly my sentiments. Drives me crazy, how these people think. I remember my Gramps telling me – “doesn’t matter what your house costs if you can afford it and you like it”.
Value is a lot more then the market.
February 27th, 2009 at 10:06 am
I couldn’t have said it better myself!
February 27th, 2009 at 12:50 pm
Preach! What drives me most batty is how integrity just flies out the window in the face of cash issues.
February 27th, 2009 at 1:51 pm
Sometimes the lack of integrity just smacks you in the face and leaves you speechless doesn’t it?
March 2nd, 2009 at 10:03 pm
I’m with you – but I know some people who feel victimized by falling housing prices. Not surprisingly, these same people have lots of issues in their personal lives. But I also know quite a few people who are very matter of fact about the declining value of their houses. And certainly, no one I know has mentioned walking away from their mortgage.
March 5th, 2009 at 12:19 pm
AMEN!! It’s ridiculous. If you don’t want to make the payments on a $200,000 loan then you shouldn’t have taken a $200,000 loan.
ACK!
March 8th, 2009 at 5:31 pm
What people should look at is the cost of renting a similar home, if they can even find one. Rents always go up and rarely go down, like house values.
Don’t understand why people are such short-term thinkers sometimes.
March 11th, 2009 at 5:59 pm
I’ve been critical of this blog in the past, specifically about your obsession with budgeting which I believe to be a sucker’s game.
Saying that, this post nails it. Nice job. These people just need to sit back and pay the loan they agreed to. I would wonder just how much of the damage in the housing market is caused by this attitude. Probably not much, but I’d bet it has a bit of influence.