Recently, I read a post on one of the R. E. discussion boards from a homeowner named ‘Alice’ who at the time, seemed to me to represent the mentality of perhaps hundreds of thousands of borrowers angry about loosing their homes and looking for someone (like investors) to blame. Here’s my post:
“It sounds like you’ve been dealt one bad break after another.
First, you bought a house, maybe your very first home, and expected it to go up in value, most like, because that’s what property does, right?
And I’m bet that you were really worried (if not in absolute fear) that, if you didn’t buy something when the market was “hot” you’d lose your chance, right?
Of course, if the property did go up in value, and you gained a lot of equity over the amount you owed the lender, you’d want to keep that should you have decided to sell the house (at a profit, of course). RIght?
Now, when you got that loan, you qualified with full documentation of your prior years taxes, proof of income, paycheck stubs, your impeccable credit (which I sure you have because you sound like a responsible kind of person who pays their bills and keeps their word, and such. Right?
And the lender that made that loan used “real money” to fund the purchase, not some goofy credit or fluffy arrangement, but rather the lender cut a check or wired the money to the seller who you purchases this house from, correct?
And, being a stand up kind of a person, you probably put the traditional 20% down payment on the property when you bought it, like many of have in the past. In fact, you may have used the proceeds from the sale of your prior home towards the purchase of your present home, so you’ve definately got “skin in the game” as some people say.
So, when you go to sell your house, and it’s worth less that you owe, being a responsible, stand-up kind of a person, and an ethical borrower, you plan to repay the lender the difference between what they gave you (remember, it was real money…from somebody’s account, somewhere!) and what you’re house will net after paying for costs of sale (commissions, escrow, and such).
That COULD be a very big number. I’m impressed that you are the kind of person who refuses to, under any circumstances, take the low road and avoid paying back that lender’s money that the sale of the house didn’t generate.
When this is all done and behind you, I know that you’ll sleep better at night because you’ve done the right thing. And maybe you’ll return to this site and tell everybody how you did the right thing, repaid the shortage yourself, and didn’t have to work with any of the vultures.
If only more American would adopt your ethics, we wouldn’t be in such a big mess (right?).”
My point: Most every one of us, whether we be owner, borrower, lender or investor, have played a role in the financial mess. Pointing fingers won’t fix the problem.
