Pride vs. Shame in Financial Matters

I read an article on MSNBC.com this week about how people are not paying on their homes and voluntarily entering foreclosure so that they can save money. The gist of the piece is that these people have simply decided to stop paying on the home and use the money for doing more fun things in life. To quote the article, “Foreclosure has allowed them to stabilize the family business. Go to Outback occasionally for a steak. Take their gas-guzzling airboat out for the weekend. Visit the Hard Rock Casino.”

I understand that there may be times when you have to stop paying on the mortgage. But that should be only after all other avenues of saving money and decreasing expenses have been ex

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13 Responses to Pride vs. Shame in Financial Matters

  1. Shzasaver2 says:

    It is shameful the lack of personal responsibilty a certain percentage of individuals have in this country.

  2. rob62521 says:

    In our society, few people accept responsibility for their actions. It’s not just financial…I recently made an appointment and when I showed up, the receptionist told me it was the next day. Normally I would think I screwed up, but since that would have been my wedding anniversary, I rather doubt if I would have scheduled an appointment that would leave my mouth numb for the rest of the day unless it was an emergency, which is was not. She made a mistake, but instead of owning up to it, she informed me she wasn’t wrong. Now, I don’t trust her when making appointments.

    As for the financial aspect, there seems to be a shame in admitting one can’t afford something. I don’t get it either. If you don’t have the money for going out or buying a new shirt, admit it. Pay your bills, after all, you created them. I agree with the article…folks need to be responsible!

  3. Elisabeth says:

    A co-worker is doing a short sale. So, she just stopped paying on the mortgage. She is not smug just following the advice of her lawyer. She was told and I have read that banks won’t talk short sale unless you stop paying the mortgage. She says she is saving the mortgage to have 1st months rent and the deposit for a rental. She seems to be under the delusion that in a year or 2 she will be able to buy another house. She’ll just use the excuse of a forced sale due to divorce and a bad market.

  4. Tara says:

    Unfortunately I seem to be the only one in my family who agrees with you. My brother, who makes enough money to pay his mortgage, is planning to abandon his house and let it go into foreclosure because he’s $100K under water and wants to move to another location (purely for personal convenience, not need). I am disgusted not only by his behavior, but by my parents condoning this action. My father especially has always taught us to honor our commitments, but even he thinks this is okay. I am shocked and appalled, but after expressing my thoughts twice on this matter I have concluded that there is nothing that will change their minds. I just shake my head in disgust and realize that there is no personal responsibility any more.

  5. Bobbi says:

    I worry that the banks will lower their “credit standards” for borrowing so these people doing this can get (and spend) money again. They should be penalized for walking away. Where there is a will, there is a way to complete your obligations.

  6. Jaime says:

    If you’re going to foreclose, especially due to hardship, you should stop paying the mortgage and start putting that money towards cash reserves. Since you are going to have trashed credit, you may need that cash to pay extra (first,last months rent) so that landlords will be more likely to rent to you.

    However, there are people out there who are gambling, who thought residential real estate would net them some kind of 200% return guaranteed. They lost that gamble and now want to back out of their loans. I don’t know, I know businesses will do this, cut their losses and run, but it feels different with residential to me. Perhaps it’s the fact that some people are acting smug about it perhaps it’s the fact that they look out loans to fund their gamble. I don’t know, I just feel that you’ve asked for and taken someone else’s money to fund your gamble so now you have a greater obligation to meet your bills.

    I don’t know. It’s not like they’re talking about personal loans from family members but it’s still something that eventually affects us all.

  7. Neil says:

    I can totally agree with this. I had to deal with my debts by using the UK equivalent of chapter 13 bankruptcy. This was due to a massive decrease in my income and a fair amount of financial stupidity on my part. I sure was ashamed. I’m back on my feet now and trying to do the right thing.

  8. audrey says:

    I’m mortified by how many people take advantage of “government programs” food stamps, medicaid and on and on all the while working under the table to afford vechicles, vacations, jewelry etc. And yes, I know people in my town that have opted to stop paying their mortgages, insurance and property taxes while they rent out the property and collect the money to finance THEIR indulgences. THAT should be a crime punishable by law.

  9. Anette says:

    But it’s also not fair that a mortgage is a business transaction for the banks, but a moral obligation for the borrowers. And trust me, predatory lending is alive and well. In late 2008, when the crisis was well underway, my husband and I moved and bought a house. By the bank’s reckoning, we qualified for more than twice the mortgage that an independent financial planner worked out with us as a good mortgage size for our income.
    We were savvy enough (and had the money for the fees) to go to an independent professional to figure out a good mortgage size. But why should it be just our job to make sure that we don’t borrow too much, not the mortgage bank’s job to make sure they don’t lend us too much? THEY are the financial professionals and it is sad that you can’t trust them in the least.
    In summary, I don’t like the behaviors described in that article but it seems like the risk of losing money is the only thing that will get the banks back into responsible behavior.

  10. Chris says:

    I agree with you. There are too many people that walk away from their obligations. That does not make it fair for those that fulfill their obligations. It is true in life that a few people that don’t live up to what is right spoil it for the majority!

    We all have to suffer for their acts.

  11. Gail says:

    I can’t even wrap my brain around the thought although I saw a co-worker do this. Knowing she was planning on filing for bankruptcy she maxed all her credit cards out completely, got herself all new clothes for the summer, took a few trips to Niagare Falls to gamble and then filed. Wasn’t much longer after that she was using her sister’s credit card and racking up charges on that. At one point she was the one collecting for a gift for the boss. When it was time to give the gift she had used the cash on herself. Some people never will learn and don’t feel the need to learn and somehow they survive although I don’t know how!

  12. rudz says:

    I like the comment, “they are your bills, you created them”. I totally laughed at Anette’s comment, though. Seriously, you think because you were not smart enough or did not educate yourself enough about YOUR MONEY, it’s the bank’s fault for giving you a mortgage that is in their favor? They are in the business of making money, this is America after all.

    Educate yourself, get a hold of your finances (you’re the one spending your money) and don’t blame other people for your stupidity. Take responsibility for your actions as this blog suggests. That’s what’s wrong in America, no one wants to accept accountability, but blame someone else….YOU SIGNED THE DOTTED LINE – DEAL WITH IT.

  13. Eric says:

    “But why should it be just our job to make sure that we don

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