Walking Away from Mortgage is Becoming More Acceptable

The stigma of walking away from your mortgage is quickly disappearing as more and more homeowners find themselves with no other option.

There was a time not too long ago when there was a horrible stigma attached to certain things like declaring bankruptcy, getting foreclosed on and simply walking away from your mortgage payments because you can no longer afford them. That stigma is changing for all three of those situations and, in fact, the stigma has all but disappeared.

One piece of evidence to attest to that is that more and more Americans are finding it acceptable to simply walk away from your home and your mortgage payment responsibility if you can no longer pay your monthly bill. More than one-third of Americans today say there are some circumstances where it may be acceptable to walk away from your mortgage and stop paying on it. This information was collected by the Pew Research Center recently and reported in publications like The Washington Post and other reputable places.

Only 59 percent of Americans surveyed said it was never acceptable to walk away from paying your home mortgage. Nearly 20 percent of those surveyed said it was perfectly acceptable to walk away from your mortgage while another 17 percent said it was only okay in certain circumstances. Oddly enough, this last option was not on the survey so the people who answered that way had to write in those answers. Of the people who responded to the survey, about 31 percent of them rented their home or apartment and 63 percent owned their homes.

More men said it was acceptable to walk away (22 percent) than women (17 percent) while 13 percent of the men surveyed said it was sometimes acceptable and 20 percent of the women agreed that the circumstances could sometimes make it okay to walk away. As far as regions go, a similar number of respondents in the East, Midwest and South said walking away was fine (between 16 and 19 percent) while 25 percent of those in the West agreed. Interestingly, only 11 percent of Republicans said it was acceptable compared to 23 percent of Democrats who agreed.

One of the reasons the stigma is beginning to disappear is because more and more people are losing their jobs. As a result, this is the worst housing crisis since the Great Depression. At the end of the June, nearly 15 percent of mortgage loans were past due and housing prices in 20 cities are down nearly 30 percent from their peak in 2006. Nearly 3,000 people responded to this survey and about 21 percent of them were underwater in their mortgage loans, meaning that they owe more on their home that its current fair market value. This is also adding to the mortgage crisis as homeowners are feeling trapped in a dead end situation. All of these factors together are bringing down the economy and making things rough on everybody.

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