With all the wonderful things the Internet brings us (such as Active Rain), it also opens the door to many, many forms of bad behavior.
Want to cheat on your spouse? There’s a site for that. Want to slander someone you don’t like? There’s a site for that. Get tips on how to lie effectively and convincingly? The list goes on.
But the one that concerns us as real estate agents is the site that encourages homeowners to simply “walk away” from their mortgage because, apparently, honoring the obligation to pay that loan is no longer convenient. We’re not going to name the site or link to it, to avoid helping publicize it, but it really does speak to the worst in people.
On the site, homeowners in financial distress are encouraged to “unshackle” themselves from their losing investment, with the promise of living payment-free in their home for months before loading up the moving van and riding off into the sunset, forgetting the house and the loan ever existed.
Because we specialize in short sales, we’re heartened by the fact that people who come to us to talk about selling their home before it gets foreclosed upon are trying to do the right thing. They recognize that they took on a moral and ethical obligation – not to mention a legal one – when they signed the contract for the mortgage that enabled them to buy their home.
Yes, they are facing hard times, either due to loss of a job, sickness, a death in the family, divorce, or any number of other reasons. But just as much as they’re trying to avoid foreclosure and the stain it puts on their credit history, they see a short sale as a way to work something out. To make a deal that allows them to hold their head up and maintain their pride even though they can’t keep meeting their obligations.
This website uses a euphemism – “strategic default” – to describe the walking-away process. The way we see it, that’s like calling it “strategic borrowing” when you shoplift something from a store.
There is a huge difference between going into foreclosure and “strategic default.” You may not be able to do anything about the descent into foreclosure. But when you just decide that this mortgage deal isn’t working in your favor anymore and make a one-way decision to call it quits, there are only a couple of degrees of difference between that and outright mortgage fraud.