Note that this is sort of the Fannie Freddie definition of rich.
Reader comment on: NYT on 'Rich' Mortgage Defaulters
Submitted by Lyle (United States), Jul 9, 2010 10:51
It also depends on where in the country you are, In the midwest a mortgage of $1 million means quite a house in CA or NY much less. Of course in New York you can't walk away because mortgages are recourse, while in CA they are non recourse. Many say that banks don't go after recourse, but sooner or later they will sell the obligations to a bill collector for cents on the dollar, and the person will have to file bankruptcy, or pay up. It is going to be an interesting issue to see if there is a push to recourse-only mortgages nationwide by lenders, I know I would not make a mortgage loan without recourse. (Except on a 50% down payment basis)
Note: Comments are moderated by the editor and are subject to editing.
Other reader comments on this item
Comment on this item