On Feb 19, 2:20*pm, Vic Smith wrote:

What I haven't heard any of the "talking heads" mention about the
mortgage problem mitigation is whether those who refi-ed their home to
buy a boat or auto qualify.

Those who refi-ed to pull money out of their so-called equity should
not qualify. *They were irresponsible and should live with that.
Same with owners of more than one home.

--Vic-

While I loosly agree with your points, you're worrying about a small
fraction of the people in trouble.

Someone who has enough equity to have an equity line of credit and
uses it to buy a boat or car has been in the house for a long time, or
had a large down payment when they bought the house. They have a
sizable investment in the house, and are typically responsible enough,
and tied to the house enough, to not walk away or get in that far over
their heads.

The problem is with the people that got a mortgage for 100% of what
their house was worth when bought, and/or signed up for payments that
they simply can't make. They have no real equity built up, and since
they have no personal investment in the house (down payment), they
feel they have no reason to keep making payments on something that is
no longer worth what they mortgaged.

I struggled for a while to understand why so many people were walking
away from houses. I finally realized they aren't losing anything but
their credit rating, which probably wasn't so great to begin with.