The punishment lenders inflict on strategic defaulters are lighter than most realize, and likely to lessen as lenders need customers in the future.
Irvine Home Address … 65 ESSEX Irvine, CA 92620
Resale Home Price …… $729,000
Trust me,
Believe me,
It's all in the art of stopping
Wire — In the Art of Stopping
There is an art to strategic default. There are many options, and some have stronger consequences than others. Does the borrower want to maintain some lines of credit? Will selectively defaulting on certain debts hurt their credit score more than others? Will strategic defaulters need to declare bankruptcy?
Now that millions have defaulted on their mortgage, we have anecdotal data and research studies on what really happens to those who quit paying. The results will surprise some and inspire many.
Eroding the Fear of Foreclosure: New Research Shows Strategic Defaulters Experience With Post-Foreclosure Credit
Posted on May 12th, 2011
One of the most cited deterrents of deciding whether or not to foreclose or strategically default is the fear of a catastrophic and irreversible hit to one’s credit score, leading to an inability to rent, purchase a new car or home, or open a new credit card. After polling some of our 5,000 clients nationwide, YouWalkAway.com has discovered it’s a fear that may be blown way out of proportion.
Susan Edwards is a client of YouWalkAway.com, a company that walks defaulting homeowners through the foreclosure process. Edwards recently walked away from a property in Southern California. “Prior to missing our first payment, my credit score was 805,” Edwards stated “I checked it again in June after we missed the 5th payment and it was 680. At the time, it was commonly reported that the average foreclosure would lower your credit score about 150 points. I had assumed it would stay in that range for up to 7 years. I was wrong.”
So, what is Edwards credit score now? According to Edwards, after only 3 months following the foreclosure auction of her property, her credit is back up to 734 and climbing. Fortunately, the hit taken to her credit was not nearly as bad as most people, including those who claim to be experts, might have depicted.
If this woman's credit score gets back above 740, there will be no real ramifications for her default. Most lenders don't have a super-duper category for those with FICO scores over 740, so the borrower with a 745 is getting the same rate and the same treatment as someone with an 805.
Edwards is not the only YouWalkAway.com client to see her credit rebound so quickly. New York resident and YouWalkAway.com client Jodi Romanello has walked away from two investment properties in Florida. While she has never closely monitored her credit score, Romanello has yet to see any negative repercussions of a credit drop. “When I first skipped payments on my first foreclosure, CitiBank Diners Club abruptly canceled my card due to ‘undesirable changes in my credit rating,’” Romanello explained. “I got very upset because I hadn’t thought this would happen, but to my enormous relief none of my other cards did this. I have a high limit with American Express Gold, Visa, MasterCard and a lot of store cards, and Amex just renewed my card with an invitation to go Platinum.” Romanello continued to explain how she staved off the negative credit effects of two foreclosures, “I am careful to pay all other bills instantly when I receive them, I run no balances on any cards month over month.”
The key to keeping a high credit score is to selectively default. Some people who strategically default stop paying on all their debts, often as a precursor to bankruptcy. Anyone hopelessly overloaded with debt is probably wise to follow that path. However, for those who can afford to maintain other credit lines, and feel the need to do so, can simply stop paying their mortgage and keep paying everything else.
When I first reported that borrowers were defaulting on their first mortgage and keeping their second mortgages current, I was shocked. I conjectured most borrowers would default on their second mortgage and keep the first mortgage current to prevent a foreclosure because it's unlikely an underwater second would foreclose. That isn't what people are doing.
Most borrowers are defaulting on their first mortgage and keeping other debts current which is helping their credit scores.
According to the study, credit cards, car payments and student loans are the most common forms of additional debt, with personal loans and medical loans rounding out the bottom. Surprisingly, only 23% of those surveyed have ever defaulted on any other debts. Many YouWalkAway.com clients have never even had a late payment on their record prior to strategically defaulting from a property. Although, 91% of underwater homeowners surveyed are facing other debts in addition to their mortgage, YouWalkAway.com has seen these recurring trends amongst many clients. Those who have handled the foreclosure strategically by closely monitoring their credit and other debt are fairing much better financially after the foreclosure.
Lenders should be thrilled that borrowers can't seem to kick the habit. People want signatory debt, and they would rather walk away from their underwater house than default on their other debts. Personally, I think people should get rid of all their debts and live on the positive side of the financial ledger, but that isn't what most borrowers are doing.
Even borrowers who opt for a short sale have seen quick restoration of their credit. San Diego Real Estate Broker, Jeff Grant can attest to his credit recovering after a short sale of his investment home which was upside down by more than $200K. “After my own short sale, missing a total of 8 mortgage payments, my credit went from 729 to 679. But it quickly recovered to 728 a year and four months later!”
Less than 18 months after a short sale, and his credit score is basically unchanged. Why would anyone fear the credit implications of a short sale?
Following in suite, Wynn Bloch’s house in Palm Springs, CA sold at foreclosure auction in March 2010. As a result of the foreclosure, her credit score fell just 45 points – from 780 to 735. “It didn’t hurt me really at all,” Bloch stated, “In fact, I was foreclosed upon last March and just bought a new house in December!” While it may be unlikely for all defaulting homeowners to purchase a home so quickly, 51% of YouWalkAway.com clients polled do wish to purchase a new home within 5 years.
From foreclosure to homeowner in less than a year. Perhaps lenders should be tougher on these people, but the need for warm bodies to sign a loan document is prompting lenders to forgive and forget. 
In reality, many YouWalkAway.com clients are more than happy to shed the excess baggage of their underwater homes and downsize to a rental. Nearly, 100% of clients report saving money by renting, and 52% chose to rent a house smaller than their previous one. Jon Maddux, CEO of YouWalkAway.com explains, “Eighty-one percent of our clients have experienced no issues renting after a foreclosure or short sale. Only, 18% were asked to provide a slightly larger deposit.”
As Susan Edwards shares, “I love being at our new house. I can imagine my dogs in the yard and our family sitting at the table for Thanksgiving. Funny,” she continues, “but I’m more excited for [my new rental] than I was when we bought this house. It really is a new beginning for us.”
Renting is a huge relief to people escaping a huge mortgage payment. Home is where the heart is, it doesn't require a big loan.
Edwards, Romanello and Bloch are not exceptions to the rule or lucky strategic defaulters who have fallen through the credit reporting cracks. They are living proof that if homeowners continue to keep on top of other debts and their credit scores, they can rebound much faster than initially predicted.
Maddux continues, “There has been a lot of misinformation regarding the effects foreclosure has on one’s credit. More often than not, it is those who have an agenda to deter homeowners from walking away who use scare tactic phrases such as, ‘Foreclosure will destroy or decimate your credit.’
That is exactly why lenders try to foster the perception that default will be harmful. It's only harmful to those who want to use credit, and apparently it isn't very harmful to those who want to get another home loan.
Due to the nature of how credit scoring works, I prefer to describe the effects of foreclosure as wounding one’s credit. Blemishes will heal on their own as long as one continues to keep other lines of credit current. Seeing it first hand with our own YouWalkAway.com clients, a homeowner’s credit will improve over time as the delinquent payments move further into the past.” …
Lenders want to keep the millions who would benefit from strategic default in a state of fear and confusion to compel the borrowers to keep paying. They would prefer to publicly endorse borrowers most macabre fantasies of strategic default while quietly soliciting new customers behind the scenes. Prior to the blog era, they might have been successful.
Study: Mortgage-only defaulters may be safe credit risks
By Julie Schmit, USA TODAY
People who default on their mortgages — but no other debts — are not as risky as expected, according to a new study from credit monitor TransUnion.
TransUnion's research shows that those who only default on mortgages are less likely to then default later on new car loans or credit cards than are people who default on mortgages and at least one other debt at the same time.
The study results, to be released Tuesday, also show that mortgage-only defaulters saw credit scores rebound faster than people who defaulted on multiple loans, which could include people who went bankrupt.
The mortgage-only defaulters “are less risky than they appear,” says Steve Chaouki, TransUnion vice president. “Lenders will want to lend to these people in the future.”
There you have it. The already light punishments for strategic default will be lessened even more in the future, provided the strategic defaulter is calculated and selective in their default.
TransUnion, like other credit-management firms, is seeking insight into mortgage-only defaulters, who could prove to be a big market for lenders. In the past five years, almost 4 million U.S. homes have been lost to foreclosure, says market researcher RealtyTrac. A chunk of those were “strategic defaults,” in which homeowners who could afford to pay their mortgages walked because home values had tanked so much.
FICO, keeper of the widely used FICO credit score, last month released one of the first credit studies on strategic defaulters and found them to be savvy about credit, with better credit histories than other mortgage defaulters.
As with FICO, TransUnion did its study — “Life After Foreclosure” — after enough people had defaulted and results could be considered valid.
TransUnion's research should diminish expectations that mortgage-only defaulters will join the ranks of habitual defaulters, Chaouki says.
Fear of being lumped in with the riff-raff is largely what prevents many with good credit for defaulting. Information like this will likely push many off the fence and into a new rental.
For instance, 5.8% of mortgage-only defaulters examined in the study were at least 60 days delinquent on new car loans which were opened after they defaulted on their mortgages. But 13.1% of the multiple defaulters were at least 60 days delinquent. The mortgage-only defaulters also had lower 60-day delinquency rates for credit cards, 11.4% vs. 27.1%. Both measures were taken at least 120 days after mortgage defaults.
Credit scores for mortgage-only defaulters bounced back quicker, TransUnion also found. For instance, consumers with Vantage credit scores — a competitor to FICO scores — in the 631 to 650 range saw their scores rise a median 8 points 12 to 17 months after defaulting on mortgages. People in the same credit score range with multiple defaults saw their credit score drop by 2 points. Vantage scores range from 501 to 990. …
People considering strategic default who wish to maintain their credit use should default only on their primary mortgage. The punishments aren't that bad, and they are likely to be lessened as time goes on.
Although, there are some consequences….
What did they need $650,000 for?
The owner's of today's featured property were solid borrowers who paid down their mortgage through the entire housing bubble when all their neighbors were borrowing money and spending like drunken sailors. But then in the summer of 2007, they obtained a $650,000 stand-alone second from a private party.
The owners who show a pattern of HELOC abuse simply spent the money as if they had earned it, but these rare cases where borrowers have large private loans, something unusual happened. Based on what the property records show, they used this HELOC to leverage themselves into a much larger home.
Before the property crash, people used to sell their properties before moving up. Perhaps they wanted to keep this one as a rental, or perhaps they didn't want to sell it for less than its peak value. In either case, they now have a massive debt on this property to go along with the $1,104,614 debt they have on their new property. With over $800,000 in debt on this property, it isn't cashflow positive.
Basically, they leveraged their modest down payment on today's featured property into two properties with nearly $1.9M in debt between them. For their sakes, I hope they either make a great deal of money or Irvine real estate starts going up.
Irvine House Address … 65 ESSEX Irvine, CA 92620 
Resale House Price …… $729,000
House Purchase Price … $322,000
House Purchase Date …. 7/24/1998
Net Gain (Loss) ………. $363,260
Percent Change ………. 112.8%
Annual Appreciation … 6.3%
Cost of House Ownership
————————————————-
$729,000 ………. Asking Price
$145,800 ………. 20% Down Conventional
4.56% …………… Mortgage Interest Rate
$583,200 ………. 30-Year Mortgage
$127,535 ………. Income Requirement
$2,976 ………. Monthly Mortgage Payment
$632 ………. Property Tax (@1.04%)
$150 ………. Special Taxes and Levies (Mello Roos)
$152 ………. Homeowners Insurance (@ 0.25%)
$0 ………. Private Mortgage Insurance
$165 ………. Homeowners Association Fees
============================================
$4,074 ………. Monthly Cash Outlays
-$498 ………. Tax Savings (% of Interest and Property Tax)
-$760 ………. Equity Hidden in Payment (Amortization)
$248 ………. Lost Income to Down Payment (net of taxes)
$111 ………. Maintenance and Replacement Reserves
============================================
$3,175 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$7,290 ………. Furnishing and Move In @1%
$7,290 ………. Closing Costs @1%
$5,832 ………… Interest Points @1% of Loan
$145,800 ………. Down Payment
============================================
$166,212 ………. Total Cash Costs
$48,600 ………… Emergency Cash Reserves
============================================
$214,812 ………. Total Savings Needed
Property Details for 65 ESSEX Irvine, CA 92620
—————————————————————————— 
Beds: 4
Baths: 4
Sq. Ft.: 2500
$292/SF
Property Type: Residential, Single Family
Style: Two Level, Craftsman
View: Trees/Woods
Year Built: 1998
Community: Northwood
County: Orange
MLS#: S658156
Source: SoCalMLS
Status: Active
——————————————————————————
* * * FANTASTIC LOCATION IN AWARD WINNING NORTHWOOD POINTE * * * 4 bedrooms plus an office in almost 2,500 square feet, 3.5 bathrooms, 2 car attached direct access garage, large and private yard, upgrades include wood floors, custom paint, newer carpet, custom built-ins, ceiling fans. Located less than 100 yards to award winning schools, meadowood Swimking Cnter, Citrusglen Tennis Center, Hicks canyon Hiking Trail and easy access to freeways, shopping and recreation.
I think this post confirms what I have long suspected: FICO scores are largely BS.
Long time reader first time poster! (Sounds like i’m on the radio) Just wanted to relate my personal experience. Bought a 1br for $270k in Santa Ana in 2006 thats been worth $110k the past couple years. (conventional loan and i put 20% down, what was i thinking) Got married and needed to move on. Had a 800 fico when I stopped making payments with plans to let it default. Squatted for about 4 months before got a bigger/better/cheaper place in Irvine. BofA canceled my credit cards (they had my countrywide loan) but no problem renting a new place and I kept current with any other payments. Score dropped to about 660 but is back up to 710 and climbing. Ended up doing a short sale which took the bank about 8 months to process while the place sat empty. It finally went through about a year ago and its the best decision I’ve ever made it my life. (although buying was far worse) I’m hoping to be able to buy a sfr in the next couple years that I can start a family in. I’ve been told though that I’ll need to wait another 2 years before I’d be able to help us get a loan.
Thank you for sharing your experience.
I wonder how many people in your circumstances are still hanging on waiting for the market to come back.
It certainly appears as if you made the right decision. Further, prices probably won’t bottom until people like you can buy again two years from now, so waiting out the decline in a rental isn’t hurting you either.
There’s another negative that could potentially be removed. A bill passed the California Assembly and is in the Senate now that would preclude employers from checking your credit score.
I know a couple people who are underwater, whose only reservation to walking is their concern about its effect on any potential employment opportunity over the next seven years.
Will not apply to positions requiring a Clearance of any level or to public positions requiring fiduciary duty or to law enforcement positions.
~Misstrial
I wouldn’t be too scared about pre-employment background checks. Most HR types (I am one) usually discount home loan defaults when reviewing credit. I would definitely, however, keep all other payments up to date and tell the HR representative about the house default after the job offer and before she sends out the reference check.
Here’s another one…remember the Real Housewife who did the short sale? Seems they’ve already found another dream home…
http://www.radaronline.com/exclusives/2011/05/alexis-bellino-real-housewives-orange-county
If the banks run out of money, Ben will just print more, taxpayers can finance another bailout. Maybe HELOC’s will make a comeback, Mama might need to upgrade the “twins”, it’s bikini season! Yay!
I ran accross this blog at http://finance.yahoo.com/news/New-home-sales-rebound-but-rb-2165792017.html?x=0#mwpphu-container and thought of Irvine Renter: The “number of new houses on the market was the lowest since the 1960’s”. Funny there is no mention of the following: According to the Commerce Department, 2009 & 2010 new homes were the lowest number built since records began in 1959. The Commerce Department further states that the annualized new build rate for 2011 is 10% even lower than last year. I guess the positive spin about the number of available new homes being down is supposed to make us feel better……until we realize it is because far fewer new homes are being built versus more homes being purchased.
Wow. I knew this would happen, but I was still a poor prophet: I figured it would be a matter of 3-5 years after default before the prodigal children would be re-admitted to the debt family.
I am kicking myself for selling my house before it dropped to less than the balance on the mortgage.
I’d only regret it if you put the proceeds into another home… otherwise, how are you better off walking away?
If Cabron sold and broke even, he would have been better off if he defaulted and saved money squatting. If Cabron sold and walked with a few thousand dollars, he could have squatted and saved more money than the few thousand.
It’s all a game of numbers. Figure 6 months at the absolute minimum of “free” rent, and then everything from there is just mo’ money. Some fortunate people (usually in the big, expensive homes, you know, the ones most of us will never ever own) get to live in them for 2 years or more.
Hey Cabron, would you have had more money saved if you got even 12 months of “free rent” versus selling?
If you are underwater, even the 6 months is at least getting *some* of your 20% down back. For the 100% loan buyers, it’s a no brainer, no money down = free rent/no loss.
I don’t wish these folks well…. just another case of greed and delusional thinking. I wish the the next buyers of their properties will get a good deal on them… which the featured property surely is not.
Maybe I’m unrealistic, but for $729K, could I get a kitchen with high-end custom cabinets and built-in appliances, instead of cheesy HD-grade white cabinets with a cheap gas range shoved into a niche? This is LUXURY? Every cheap Rogers Park, Chicago rehab is better appointed than this.. and much, much better built. And the house itself looks like it’s built out of plastic and chip-board.
2 words: debtor prisons. Let them work it off.
Absent that, all the missed payments + HELOC default should really have a bigger effect than this, unless some of these cited are unusually special cases. I’d expect an initial 804 to rebound a bit more quickly than someone who had say, a 725 starting out. But one would think a double hit would have a pretty good effect regardless, absent of any “special tricks” attempted by web companies like these, or lawyers touting they can get your score back up there again in no time.
Downside if things are truly going to be like this (for most defaulters), then nothing’s going to significantly improve on the lending side of things for a while. In which case, I hope the banks enjoy their new default rates they’ve brought upon themselves until at least 2013.
Although, in 2012 the CRAs could decide to revise to handle walkaways completely differently, which would make this article somewhat invalid. And the whole IRS situation post ’12 should take care of the rest. I suspect bankruptcy would be no remedy there either, though offer & compromise deals always seem to exist at least the first time around.
Debtor’s prison eh? Well good brianguy, you may just be getting your wishes granted, but it will be for the next generation and it will be called “student loans”. These are “unforgivable” just like you want mortgage loans to be, just like the old royalty wanted it to be. Slaves to the ones who control the money (i.e. banksters).
Student loans are “unforgivable” because you can’t forclose on a college degree like you can on a house or car. If people could run up big student loan debts and discharge them by bankrupcy right after graduation, the whole program would fall apart. Right after graduation is when people typically have the least assets of their professional life.
Its not a conspiracy by the man to keep people in debt slavery. You can choose to get student loans or not, no one is victimizing people with student loans.
“Student loans are “unforgivable” because you can’t forclose on a college degree like you can on a house or car. If people could run up big student loan debts and discharge them by bankrupcy right after graduation, the whole program would fall apart.”
The sooner the student loan program falls apart, the better. You have listed EXCELLENT reasons to let people who cannot pay bankrupt AND to shut down the entire student loan program. It never really was workable, and it has been the major factor in inflating college tuition.
No creditor should be protected from his mistakes, and no one should be in debtor’s prison for life.
I don’t know how the govt goes after ex-students who don’t pay. Garnish their wages? The old debtor prisons, the govt would need to feed the prisoners, except in LA and foreign prisons.
The BK route was exactly what many lawyers and MD’s did pre-1982. Many MD’s that did pay were very resentful that the deadbeat ones were getting away with it and showing off with their new borrowed wealth and larger disposible income (no more loan to payback). Some just know who to milk the system and had no qualms about it.
Most of the welfare/entittlements in this country goes to the large corporations and SS. It the same old story with the lending collapse, blame it on the red-lining lending laws, i.e., the blacks. No law forced the banks to make multi-million negative equility loans to NPB borrowers.
Big deal. They already have been for my generation.
At least it makes the whole education game slightly less rigged. People need to pay their bills. Can you imagine going to school for 3 years, dropping out because your job prospects sucked, and then deciding to stiff the bank (with most loans government guaranteed)? And actually getting away with it?
That’s why the student loan programs should be shut down, brianguy.
No category of debt should be treated differently than any other. All we have done by A)supplying students with easy money for whatever bullshit course of study at whatever diploma mill accepts them; and B)guaranteeing lenders against the risk of lending for such a purpose on such terms, as well as giving them the privilege to employ collection tactics that were outlawed for every other type of debt more than 40 years ago, is to create a permanent debt-serf class of people who will be condemned to poverty and instability for all their living days, and create yet another mountain of debt that cannot be paid back.
Because there’s no way most of these people stand a chance of being able to repay 6-digit loans. Consider a law student who borrowed $200K, figuring that law is such a high-paying profession that he would have no problems paying off the loan. Well, even given the most optimistic case, this is crushing load. Even were the kid to be fortunate enough to start at $125K a year as all the TTT schools promise he will, $200K worth of debt with interest that can be raised at any time, he will be staggering under a crushing load relative to his income.
But he is really more likely to start at $40K a year (if even). How will he make payments of $1300 a month or more and still remain housed and fed, let alone pay for transportation and any essential medical care, or medical insurance (which he probably wont get at his first job).
Since our population is by and large financially illiterate, and extremely delusional as well, there is no solution to this problem but to cut our losses and move on. We’ll just have to accept that the bulk of the existing college debt will most likely never be repaid, and do what we have to do to prevent recurrence of the problem, which is to shut the loan programs down forever and for good. We simply have to allow that we made a massive mistake and stop making it.. and absorb the hit as best we can, just as we have the monstrous losses to the housing bubble.
Maybe we will finally get it through our heads that any social program that tries to do more than provide minimally for people who absolutely cannot take care of themselves, is a social program that will end up causing many more social problems than it cures.
Most student loans are are “unforgivable” . The law was changed in the 1980’s to prevent newly minted lawyers and MD’s from declaring BK to rid the burden of the loans. Even after BK, the bands were eager to loan new lawyers and MD with a BK on their credit history. The are a few programs to get reduction of the student loans through govt service, which can pay very well.
“Strategic default” is just a euphemism to make something very unethical sound palatable. Foreclosure is a safety net set up to protect those who truly can’t pay. It was never meant as a payment option for those who simply don’t want to pay what they agreed to. You are abusing a public safety net and you are breaking your promise to pay. As distasteful as the banks are in other areas, they upheld their portion of the deal with you when they paid for the house originally. Also, given that your mortgage has likely been repackaged and resold, your “strategic default” is probably also stealing from somebody’s retirement, not to mention from taxpayers who are also left to clean up your mess. Shame on you all.
If you can’t stand the risk, don’t make the investment. What? You thought there was no risk lending money to someone?
Walking away next month ($130K underwater). Estimated time to equity recovery? Over 79 years. I can live with a couple years of bad credit vs “renting” my own home and being tied to it for the rest of my life.
Suckers are the ones who *don’t* walk away. The deal says you can hand the keys back, get a black mark on your credit score, and lose
your down payment. Sounds fair to me.
Am I correct that a debt written off will be taxed as income received? So walking off a 750K loan, say the bank releases obligation? Sounds pretty BRUTAL of a tax bill to me. Sure, these California suckers who fell into such a trap are now broke but in that type scenario then where do they run? It just sounds like a vicious cycle of abuse and distaster to me.
Hi Thom.
The IRS is foregoing taxing that from 2007 through 2012:
The Mortgage Forgiveness Debt Relief Act and Debt Cancellation
Not sure about states.
Irvine Renter,
You start this post with the astute observation that punishment for SD is “likely to lessen as lenders need customers in the future.”
In addition, there is a growing amount of evidence that strategic defaulters are in fact some of the very best borrowers. They have higher credit scores (before onset of default). They have higher incomes. They qualified for larger mortgages. They manage their debt better. And, they are more informed. There are a number of articles and research papers, but here are two recent ones.[1][2]
In fact, I started my company to specifically extend credit to families with severe negative equity but who have decided strategic default is in their family’s financial best interest. This is not because we need to find customers, but simply because they are good borrowers.
Just don’t put them in a contract that is against their best interest.
Mark Moore, CEO
HomeLiberty, Inc.
Not sure what happened to the two papers I linked…
The first is from Morgan Stanley titled “Understanding Strategic Default” by Tirupattur, Chang, and Egan.
The second was results announced in a press release from FICO, April 12, 2011.
[1] http://www.transunion.com/docs/rev/business/financialservices/FS_MorganStanleyStrategicDefaultResearch.pdf
[2] http://www.fico.com/en/Company/News/Pages/04-21-2011.aspx
How pathetic has this country become? Promoting a strategic default as the new American way of life shows just how close to the bottom we are.
Sure, let’s get everyone who didn’t have enough common sense when they made their purchase but can still afford their mortgage payments to just stick it to the investors that provided the loan.
While we are at it, let’s also do this to the banks who issue credit cards along with anyone else stupid enough to grant someone credit.
Face it, the entire USA is nothing more than a nation of bankrupt, incompetent, corrupt individuals and entities and it gets worse every single day.
So let’s just keep this pile of crap rolling until this deadbeat country finally comes to an abrupt stop and the riots and total chaos that are coming, can take over.
Most of you idiots can’t see the handwriting on the wall and what it says is your days are numbered. In the end you usually get what you deserve and that will surely be the case when this fiasco finally ends.
Not sure where to start with your rant, but frankly, you’re wrong.
The US does so well specifically because its easier to discharge debt than other countries. You come to the US and start a business and it doesn’t work out? You can get your debt wiped clean. Not so in other countries.
If we preventing the discharge of debt, it would hamper risk-taking and innovation. Not all risk-taking is bad, just the excessive, uncontrolled sort perpetrated by the investment banks during the real-estate go-go era we just experienced.
Exactly what part of what I said am I wrong on? Sounds like to me you’re one of those who probably already defaulted or is thinking about it.
So is it your take is there is an everlasting eternal game going on in this country where debt will just keep getting washed away with no major repercussions? Have you ever heard of a Ponzi scheme which always crashes and took down Bernie Madoff? Did you catch the interview Madoff did when he said the whole US government was nothing but a Ponzi scheme?
I don’t know what planet you are from but you need to get your head out of the fog, wake up and enter reality. This game is about to come to an end and sooner rather than later.