I attended the sold-out webinar on January 27th. Brent White is a professor at the University of Arizona, attorney, and author of the "Underwater Home". Known as a controversial figure for his academic writings, and lectures on the topic of STRATEGIC DEFAULT. He does not advocate walking away, but does insists it is not a moral issue but rather a business decision. I am seeing this shift in the Luxury home market (whereas the negative equity is over $100k) and baby boomers whom are not too far away from retirement and don't have the years to invest in waiting for the market to recover. Rather they prefer to take their losses now and wait a few years to rebuild their credit to invest in real estate again. Most economists and market analysis predict it will be years before the Phoenix area housing future comes into full view. Zipcodes like 85009 which have had an 81% drop in market value may never recover. Even if homes were to double in value twice, it still would not be worth half as much as they used to be. High unemployment rates, increase in bankruptcies, economic hardships, and more home buyers becoming renters all impact the recovery process. Brent White demonstrated many different scenarios and formulas to help homeowners attending the seminar determine whether it is worth putting themselves, and their family through the stressful process of strategic default, in some cases it is just not worth it. One concern he pointed out was supplying lenders with current financial information that could be used against them later if a loan modification does not work out.There is a lot of emotional feelings (ups and downs like a roller coaster) when a homeowner considers "walking away". This book walks homeowners through all the parts involved in the process of considering a STRATEGIC DEFAULT. Is it a moral obligation or a business decision? Obligations to society and to your neighbors (ch.1) Brent has some great analogies to convince homeowners to stay put (ch. 3 & 4) or do you need to move because of a job transfer? He covers a wide range of topics and questions most homeowners have on their minds like: tax consequences, fear of being pursued by their lender (ch.2), buying and bailing (ch.4).
I highly recommend reading this book today if some of these concerns and questions lay heavy on your heart and mind.
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