Traditionally the idea of becoming home owner carrier’s thoughts of family, memories and time spent together within the security of the home. These are the first thoughts that come to most American homeowners. Viewing your home from strictly an investor’s point of view can be too harsh for most people.
The phrase “losing your home” has so much negativity attached to it. The term itself suggests that you have done something so wrong that your home is being taken from you. These feelings cause many Americans to begin to question their morality. They start to second guess their choices and blame themselves for not being able to stay within their homes. The fact is that looking at losing your home can no longer be looked at one dimensionally.
The economic down turn has created a real estate market unfamiliar to the traditional homebuyer. What was once a promise of hope for the future; has become a burden of unending debt. As with most homes the homeowners agreed to and signed paper to repay a loan for their property. The terms of the loan are spelled out but it is the unspoken terms that are now in question.
It is because of the banks that the housing market crashed. They freely handed out loans to people who could not afford to make the payments. They also created loans that represented up to 125% or more of the closing of the home. Cash back for what? The cash was used for everything from the required down payment, to kick backs for the mortgage brokers. During this time loan officers and mortgage brokers were making killing on the number of completed loans.
The dream of becoming a homeowner quickly became a nightmare as homeowners watched home after home on their block plummet in value, taking their, right along with it. The pain of having to make payment after payment, while watching the value of your home sink far below the pre-sale value has become a deal breaker for more and more Americans.
So, the question remains, at what point does the destruction of your homes value outweigh your moral obligation to stay and pay?