32% of Americans Think Strategic Default Okay
A new poll, conducted by John Zogby’s JZ Analytics, reports that 32% of U.S. homeowners feel that borrowers should be able to strategically default without facing consequences.
Some survey participants said they would feel justified with a strategic default because they believe the mortgage market is a scam that takes advantage of its customers (paraphrased).
In my own personal experience as a broker, I have encountered only a handful of borrowers who strategically-defaulted over the past few years.
All of those borrowers were severely underwater after being enticed into 100% financing by overeager lenders during the boom times.
In each of those instances, the lenders refused to work with the borrowers to keep them in their homes and, instead, incurred huge losses with short sales or REO sales.
I have encountered far more distressed borrowers who continued paying on their underwater homes because they felt morally bound to keep their commitments..
I suspect this may have something to do with Idaho value systems.
Source: DSNews.com article
October 5th, 2012 Posted in Inside Real Estate
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