An interesting take on home foreclosure crisis:

A homeowner who can't sell his house tells the L.A.Times, "Foreclose me. ... I'll live in the house for free for 12 months, and I'll save my money and I'll move on."

... Wachovia, in a conference call yesterday, warned investors that increasing numbers of homeowners are walking away from their homes by choice: "... people that have otherwise had the capacity to pay, but have basically just decided not to because they feel like they've lost equity, value in their properties..."

And more:

A commenter on L.A. Land this morning writes:

"I realize I agreed to the deal when I signed the mortgage papers, but I am within my rights to walk away from a bad deal and suffer the consequences, just as many corporations write down billions of dollars of debt, lose money for their shareholders, and lay off people as a result of their bad decisions.

"I don't really understand why people view a business decision by a homeowner as a terrible moral lapse. However, when large lending institutions, with access to more sophisticated information than any consumer could imagine, make mistakes affecting thousands of people worldwide, they are not excoriated and vilified with the same righteous zeal."

Interesting perspective.

Maybe it's just me, but does the knee jerk reactions from the Fed and the Pres/Congress seem a little overdone? I mean, the whole reason we got into this mess is 'cause of bad loans. And now, the solution is to loan banks even more money?

And the tax rebate thing ... I'm all for free money ... but now? How long 'till we get our money? June? July? Isn't 8 months a little long to have any impact on the economy? And why do I get the sense that the people who most need this money aren't going to get it?

Posted by roy on January 25, 2008 at 01:24 AM in Ramblings, Finances | 1 Comments

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Comment posted on January 25th, 2008 at 06:29 AM
There's this really fine line because of the mixed bag of mortgages that went south. On one hand, you have people that really were suckered by banks into bad loans, but then you have people who took these loans thinking they could quickly flip the property for profit. You have a little sympathy for the former but not the latter. But its really hard to figure out who fits in the former and not the latter.