I have heart felt conversations with clients about walking away from underwater houses day after day. *
The mortgage payments on their home eat up fifty percent or more of their income.
They’re struggling now, and the mortgage will reset soon.
Attempts to modify the mortgage are fruitless. They expect a foreclosure notice any day.
Yet despite the pain, these clients express reluctance to move because of the impact on their children. Other points of resistance are professed attachment to the present house. It’s our home, they intone.
They imagine that moving will scar the kids and render them insecure and vulnerable. Leaving a home that offers nothing but debt nonetheless seems to be a horrendous and overwhelming prospect. More than their stressed out selves can manage.
Moving away from bad mortgage
That’s the parade of horrors that march through the minds of those facing decisions about a bad housing situation.
I got a peek at the actual impact of moving from a former client last week: sheer and utter delight!
The two children, middle school and high school, were happy, making friends, and making grades.
The family had rented spacious and fresh housing in a lower cost community at less than 25% of the mortgage on the over encumbered house here.
The family income covered their living expenses and were able to make provision for some savings.
Stresses were less, family life was satisfying and the future looked better.
And the house they walked from still sits here, empty and the loan unmodified.
Home is where ever you are, not a piece of real estate.
A rewarding home life turned out to be unrelated to living in the original house.
* I write about walking away too.
Three Questions When The House is Underwater
Image courtesy of frankhg
