“We expect you to repay your debts.”
Those seven words could save America. Let me tell you why.
Heads, I win …
Surely you’ve heard of the onslaught of people walking away from their homes because their property is worth less than the mortgage balance. Even borrowers who can afford their monthly mortgage payment are stopping, simply because it doesn’t benefit them anymore.
This is entirely legal in many states. After the house is forfeited, “non-recourse” laws prevent lenders from going after these borrowers’ assets or garnishing wages in an attempt to be made whole. It’s a one-way ticket: If the housing market works in your favor, enjoy the ride. If it doesn’t, that’s the lenders’ problem. Better luck next time.
http://www.fool.com/investing/general/2010/03/03/the-7-words-that-will-save-america.aspx
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