Millions Considering Walking Away From Mortgages

10% of mortgages expected to be underwater by June
By Rob Quinn,  Newser Staff
Posted Feb 3, 2010 4:56 AM CST
Millions Considering Walking Away From Mortgages
A California man walks through an empty living room as he vacates his home in Culver City.   (AP Photo/Jason Redmond, File)

The long slide in property values has left huge numbers of homeowners considering just walking away from their mortgages. People start thinking about jumping ship when their home value falls below 75% of what they paid for it, according to new research. Over 5 million Americans are expected to be in that situation by June and the Treasury admits that it hasn't come up with any large-scale plans to help people trapped in "underwater" mortgages.

Homeowners, many of whom bought at the peak of the property market, are having to weigh the ethical questions raised by walking away—and the death blow to their credit rating—against the fact that staying no longer makes financial sense. "People like me are beginning to feel like suckers,” one man who doesn't expect to be able to sell his Miami condominium for what he paid for it until 2025 at the earliest tells the New York Times. “Why not let it go in default and rent a better place for less?” (More mortgage stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.