As home prices fall, more borrowers walk away

[Yo_Mama]

73. This guy is not contemplating walking away

The article is using sloppy terminology.

This guy is facing a situation in which when he and his wife retire, they will not be able to pay the mortgage. That's a completely different issue than walking away, which is when you can afford to pay the mortgage but don't find it financially advisable to do so. He hasn't abandoned the place yet, but eventually either the creditor works out something affordable for this couple or the creditor gets stuck with a bad mortgage. The man is 68, for heaven's sake. How many more working years does he have?

And btw, any bank that tried to file for a deficiency judgment on a retired couple that can't afford to pay the mortgage would be excoriated in public opinion and probably not treated much better by the judge. Usually retirement assets are protected from such judgments. In most states, you can't file for deficiency judgments on purchase money - only on cash-outs.

In Washington state, to get a deficiency judgment on a mortgage you have to foreclose through the courts, which is more expensive. And you are barred from getting one on a property abandoned for six months before the foreclosure, so his chance of facing a deficiency judgment are very slight.