The Case for Walking Away

At this time in our country we have a process going on with banks and credit card co that led the unwitting consumer into a impossible situation, finacially to escape from. Not necessarilly from irrespossibility but from the hype of every bank giving out easy credit and artificially INFLATING THE VALUE OF HOMES IN CAHOOTS WITH THE REAL ESTATE BROKERS NATIONWIDE. It is hard to believe,but I witnessed it in my own neighborhood within a matter of approx 3year span, They have investors come into a neighborhood,they offer MORE THAN THE OWNERS ASKING PRICE. This immediately causes other homeowners to inflate their price(per their realator), the they come back later declaring the home is worth nothing, you just lost all your equity and are now paying a bank for a worthkless house! MOST PEOPLE USED PART OF THEIR EQ1UITY TO HELP PAY THEIR BILLS. NOW THEY HAVE NONE,AND WITH NOW DOWNTURN ECONOMY ,THEY EVENTUALLY LOSE THE JOB THAT WAS PAYING THEIR MORTGAGE, EVEN THOUGH THEY HAD TO USE SOME EQUITY TO HELP OUT, WHICH IS NOW GONE ALONG WITH THE JOB. ALL DUE TO INFLATING REAL ESTATE PRICES, AND THE TV/PRESS INFLATING HOW BAD EVERYTHING IS, MAKING THE SITUATION SEEM WORSE. tHE BANKS AND CREDIT CARD COMPANIES SHOULD BE HELD ACCOUNTABLE FOR THEIR PREDITORY WAY OF DOING BUSINESS. THEY SHOULD CUT EVEY LOAN DOWN TO THE POINT OF THE WORTH OF TODAYS REAL ESTATE PRICE BASED ON THE BEST APPRASIAL. EASH PERSON SHOULD HAVE AT LEAST A 120 DAY RECOVERY PERIOD. THE CREDIT CARD COMPANIES SHOULD LOWER THEIR INTEREST TO ABOUT 3-4 % ,SINCE THEY GET THEIR MONEY FOR FREE FROM THE FEDS. THEY ALSO SHOULD REMOVE APPROX 2/3 OF THE CREDIT CARD BILL,WHICH THEY COULD THEN BE ALLOWED TO WRITE OFF. AFTER THAT, ALL CREDIT REPORTING AGENCIES BE ORDERED TO CLEAR ALL CREDIT SCORES RESET TO 800. THE GOVERNMENT SHOULD STEP IN AN REBATE A REFUND OF 50000. PER FAMILY. tHIS GUARANTEE WITH KICK THE ECONOMY IN GEAR , INSTATNTLY! WE ALL KEEP OUR HOMES,ADN WE STILL HAVE OUR RESPECT AND DIGNITY. ALSO ,THEY SHOULD CLEAR ALL BAD CREDIT AND BANRUPTCIES FOR THE LAST 20 YEARS!

I have been in the real estate industry for the past decade. My company in an attempt to stay in business moved me to several different offices in several different locations. I sold and rented and then finally bought again, a modeslty priced home at the time and since I had gotten screwed in taxes for renting the year before thought it was the smart thing to do. 11 months within purchsing my home it's value depreciated over 85k. I just had it appraised in an attempt to modify my loan and it has depreciated over half of what I purchased it for. In the past 3 months I have lost my job, about to lose my home and are scared and wondering what I am going to do..... I am a responsible citizen. Pay my taxes, pay my bills on time, honest and loyal......I have been contimplating BK because I am at a crossroads. For someone to post that we are all irresponsible and gluttons....WOW!! I think alot of people are anything but//// Hard working americans are suffering the effects of banks and lenders bad decisions and loans and trying to keep up with what the market said a median priced home was.

This type of advise expounded by ultra liberal college professors provides the failing for the future generation. All of the college prof's should have gone through the great depresion before teaching responsibility.

Grant

Scott what she is saying is if its your don't see a way out, dont hold on to the very end, and end up worse of they you could be. I got injured on the job five years ago and ended up losing my job, permantly disabled at about 50% and had to start over. I declared bankruptsy salvaged what I could and now five years later my credit score is 700+ and I was able to purchase a home. She is saying if you have lost your job and are spending your retirements stop, decalre bankruptsy. There is a good chance that allot of us may not get a Social Security check when we retire, the 401k may be all you have.

Art

Regarding the posting by; Posted By: scottt
AMEN!!!

Is this a legitimate answer to my/our economic downfall? I am among the recently laid off, with a solid bill pay history who is facing a depletion of funds over the next 6 months. Is this premature to file while I still have resources for the next few months? My unemployment covers 60% of my bills, but with the outlook as grim as it is, should I file now and pay for it for the next 10+ years? My student loans are paid, myhouse is worth what I owe, and family has offerd to assist (for a little while). If I can keep my house, skip major bills and let go of my vehicle, while keeping my cash...why should'nt I?

I am concidering this, but when is the right time?

To Andyscircus comment below. You obviously have no clue what has caused the meltdown. Do you think people who work hard, and save for their retirment have not been "taught by their parents" how to handle finance. I know people who are retired and have lost $50,000 and more in the stock market. These people made very good living's and made very good money, but now have to look at going back to work to make what they have lost. This has no bearing on how you were taught to handle finances. You see business's filing for bankruptcy all the time look at donal trump! He knows how the system works and he uses it to his advantage that's how life works in the real world. Let me see how would you respond to the other writer below owe's $50,000 most on credit and most people are anywhere from $30,000 to more under their current mortgage. The whole reason to get a house is to build equity in it how about now? I don't hear agents saying "why pay rent when you can own your house" Why! that is exaclty the questjion . I bought my house for $170,000 and now in a year it is worth $140,000 with my builders going bankrupt, and my HOA going bankrupt half built houses, half built roads, no warranties to protect me in my house becuase of the bankrupcy why should I not walk away and start over? You should be very careful what you say I never thought I would be in a situation where I am in right now, but I have not given up yet. The way to get this country back on track has little to do with making people responsible for their actions. Bankers are scum and I know this because I have dealt with them for many years in my job. They are getting what they deserve, and now we see them on their knees begging to be saved. Let them fall!!!! They have put us in this mess and they should reep what they sow! I am not saying that people should not be held responsible, but they should have not given people money that can't pay back. IF you buy a car and then a month later you decide to take it back because you cannot afford it will they do it? Exactly! The same should go for the banks scums out their. I am not saying bankrupt is the way to go, but you need to look at what you have and see if it is worth doing or not.

The rich have been doing forever. The rich know how to use bankruptcy to their advantage and then sell the "personal responsibility" concept to the poor. The chumps are the one's buying that!

I'll be here all week accepting advise from some University of Iowa law professor. Duh!

JustMichael, Class of 1989, University of Iowa.

Another GREAT idea! No Responsibility!!! Free Money! Free Sex! Free Drugs! No body else but ME ME ME! Let's spend all my money and then spend the taxpayer's because it's all about ME ME ME! I made bad decisions but you know what...it doesn't matter...because I don't have to pay for it! You do!! Because I AM WORTH MORE THAN YOU! That's right, baby! It's all about ME!!! I love ME! My mommy loves ME! Everybody should love ME! You deserve what you get...being so re-spon-sible. I had a new car when you drove your used one! I bought and bought and bought...because it's all about ME ME ME! I look cool...and now who's the idiot?! YOU! Because YOU are paying for ME! I would say thank you,,,but you're such a dumb chump, you wouldn't understand ME! Now I'm off to bankruptcy court so I can make everyone else pay for ME...and then I'll get back to spending so I can do it AGAIN!!!! Because nobody loves ME more than ME!!! WEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE!

To mrkwildcat:

The only was this nation will be better again is if there is a system that exists that allows the average working man to make a living without having 2 or 3 jobs to do so. That means that the congress and this bastard of a president we have had for the last 8 years that sold us out to China and the Banks need to be held accountable to highest extent of the law and constitution. If the founding fathers were here today, and were witnessing what your supposed representatives were doing to trade and tax laws in this country they would have them swinging from the trees. The working man is being screwed, and that is why this nation is collapsing, until this is turned around, things will continue to decline. There has to be a serious fix planned by February, and if it doesn't happen, by the end of this year you will see the beginning of the end of the USA. Once we enter another great depression, the country will go into riots and anarchy. After a period of time, when the smoke clears, the USA as you know it will have ceased to exist, along with its government. People can't pay their debts, if they have lossed their ability to pay back their debts. At the time of signing my mortgage documents in year 2000, I had a stable job, health insurance, and no reason to not sign documents to pay back a loan. However circumstances changed as time went on, and the country has lost 3 million manufacturing jobs since year 2000 alone. People have lost their jobs, their health insurance, and now their 401K's, and soon to be pensions as well. You cannot blame these events on the average individual who has no control as a single individual over these events. Mrkwildcat, you are the one who is ignorant.

A farmer comes to the city with his favorite rooster to see a movie. But, at the ticket window, the clerk tells him that the rooster cannot come inside. Not taking no for an answer, the farmer goes around the corner of the builiding and stuffs the rooster down the front of his bib-overalls, returns the ticket window, buys a ticket, enters the darkened theater, and finds a seat which happens to be to the left of 2 old maids.
After about 10 minutes, the farmer who wants to give the rooster some air, unbuttons the fly on the bibs to allow the rooster to stick its head out the opening.
The old maid to his left sees this, but cannot quite make out what it is sticking out the fly.
She pokes her friend, telling her that there is a guy next to her with his thing sticking out.
"Well, at our age, once you've seen one, you've seen them all," answered the friend.
"That's true, but this one is eating my popcorn!" exclaimed the first old maid.

For further clarification the banks originally offered me more than 3 times my salary at low interest but since have slashed it even though my payments are current (sometimes a week slow if between pay periods). How do we deal with a system like that which bombards you with mail day after day offering money and then yanks everything all away even when you are doing your best to make payments?

If smokers can sue big tobacco for lung cancer and obese people can sue fast food chains for their weight induced illnesses can I sue the banks for coercing and actively pursuing me with false claims of high credit lines and boundless low interest rates until they pushed me over into this situation? I used to get on average 10 or more credit card offers a week during the height of my career.

You should be ashamed of yourself to write such an article or for that matter to publish such an article . This is whats wrong wiith this country . Greed , ignorance and stupidity . Until that is fixed this country cant be . Why not write an article on how to work through things and advance yourself through by buckling down and actually working your way out of the problem . Bankruptcy is for a last ditch effiort when there is no other choice .and you have exhausted all avenues . It is not a tally it all up lets see what more we can add on and oh lets get this fixed also and then screw everybody . Belly up take responsibllity for your actions and hope for the best .
"TOUIGH TIMES NEVER LAST BUT TOUGH PEOPLE DO . "

When youve exhausted all possiblities remember this YOU HAVENT !

How old are you, asked the bankrupcy judge?

35. I must be 35 since I have had the 7-year itch 5 times, answered the respondant.

Katie Porter. Who planned the Tylenol Poisonings of the early 1980's? Since you are at THE UNVERSITY OF IOWA......

Class of 1989 here.

You know, we all want to point our fingers at other people and blame them for the problems of the world, but really it is our own faults. If all parents would teach their children the importance of being financially responsible, and ways to do so we wouldn't be in nearly the predicament we currently are. At the same time though, I feel that it is ridiculous that all these people who are filing for bankruptcy because they are simply idiots and screwed themselves over financially are getting away with what I see as a slap on the wrist. I think that a good remedy for such a situation would be a financial responsibility course which the party involved will have to pay for would be a great step towards improving our countries situation. I have never been in the situation where I was forced into bankruptcy and am not a lawyer, so I don't know much about it, but there should also be increased punishment if you file for bankruptcy more than one time....Just a thought.