Walking away from mortgage OK, some say
People who decide to stop paying on an underwater mortgage and let the lender foreclose are the target of a lot of heated debate, but they might have more support out there than they think.
Just over a third of Americans polled by the Pew Research Center say "walking away" from a mortgage is an acceptable practice, at least in certain situations. Nineteen percent say it's OK, period, and 17 percent more say it depends on the circumstances, Pew said Wednesday.
The group surveyed 2,967 adults, both homeowners and renters.
A survey released in April by financier Fannie Mae, meanwhile, said all but 12 percent of respondents called it unacceptable to walk away from an underwater mortgage. (Fannie Mae, naturally, is in the anti-walk camp.)
Both economic research and the Pew survey find that just over 20 percent of borrowers -- about one in five -- are underwater, meaning they owe more than their homes are worth.
"Not surprisingly, how people fared financially during the Great Recession is linked to their views on walking away from a mortgage," Pew editor Rich Morin wrote in a piece about the poll.
Those who say the value of their home fell during the recession were more likely to consider walking "acceptable" than those who think their values haven't dropped -- 20 percent vs. 14 percent.
"Nearly one-in-four adults (24%) who say their families are just able to pay their monthly bills or can't meet expenses say it's okay to stop paying a mortgage, compared with 14% of those who say they 'live comfortably,'" Morin added in his piece. "But homeowners who say their homes are worth less than what they owe are not more tolerant of the practice than those who would break even or make money on a sale (18% vs.17%)."
Renters can comfortably tsk-tsk without fear that they'll be faced with a walk-or-not decision of their own in the near future. But as it happens, 25 percent of tenants told Pew that it's acceptable to walk on a mortgage -- more than the share of underwater borrowers.
What's your take? Here, have a poll: