Are there circumstances that justify walking away from your mortgage? As mentioned in the Credit Crisis video we are now in the middle of a cycle where home prices are falling, banks have an abundance of foreclosed properties, and supply is high and demand is low. Some homeowners are facing situations where they owe the bank $300,000 for their house, but the house is now only worth $200,000. So they are packing up their things and giving it back to the bank to let them deal with it. Now the bank has to deal with the $100,000 gap.
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