Thousands of homeowners underwater on their equity have stopped making mortgage payments, not because they don’t have the money, but because they feel they can get away with it.
As banks and other lenders face millions of potential foreclosures, they are in no rush to take over single family homes and condos for a variety of reasons, including having to then assume tax liabilities, condo maintenance fees, and have empty properties ripe for vandalism.
A New York Times article yesterday said that the “average borrower in foreclosure has been delinquent for 438 days before actually being evicted, up from 251 days in January 2008, according to LPS Applied Analytics.
“More than 650,000 households had not paid in 18 months, LPS calculated earlier this year. With 19 percent of those homes, the lender had not even begun to take action to repossess the property — double the rate of a year earlier.”
New York Times reporter David Streitfield wrote from St. Petersbury, Fla. that “For Alex Pemberton and Susan Reboyras, foreclosure is becoming a way of life — something they did not want but are in no hurry to get out of.
“Foreclosure has allowed them to stabilize the family business. Go to Outback occasionally for a steak. Take their gas-guzzling airboat out for the weekend. Visit the Hard Rock Casino.
“Instead of the house dragging us down, it’s become a life raft,” said Mr. Pemberton, who stopped paying the mortgage on their house here last summer. “It’s really been a blessing.”
To read the rest of this fascinating article, click here.
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[...] here to see a original: Homeowners Spend Mortgage Payments Instead Of Paying Banks … Uncategorized [...]
Yeah, we’ve been hearing this story for a few months now, with nothing but the occaisonal anecdote to support this conclusion.
[...] via Connecticut Watchdog. [...]