Strategic defaults are on the rise.
They occur when the homeowner decides, for whatever reason, enough is enough and they stop paying their mortgage – even though they can afford to make the payments.
Homeowners commit “strategic default” for a host of reasons, some good, some bad.
Sometimes homeowners walk to shake the tree, hoping the lender will offer relief that’s not available to homeowners who pay on time.
Others want to get rid of that sinking feeling. Homeowners are so far underwater – owing more on the mortgage than their home is worth – they believe they will never see equity rise above their level of mortgage debt.
Still others say it’s simply a calculated risk that the credit hit will be worth it and moving on to renting now and buy later, is just more affordable.
YouWalkAway.com recently reported the expiring Mortgage Debt Relief Act (MDRA) is prompting more homeowners to take the strategic default route sooner rather than later.
The site offers a “Make Sense to Walk” interactive calculator, strategic default testimonials and other tools to help homeowners facing foreclosure make objective decision.
Opinions are mixed.
Few don’t have an opinion on the strategic default gambit.
However you view it, here’s an infographic to offer more information on what it can cost and how it can benefit you to lose what’s likely your most valuable asset – on purpose.
Mouse over and click to enlarge.