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comment by mk
mk  ·  4601 days ago  ·  link  ·    ·  parent  ·  post: To Have Is to Owe
"Now we owe our lives to the nation that formed us, pay interest in the form of taxes, and, when it comes time to defend the nation against its enemies, pay back the principal with our lives. This is a great trap of the twentieth century: On the one side is the logic of the market, which insists that we don’t owe one another anything. On the other is the logic of the state, which insists that we are born with a debt we can never truly pay. In fact, the dichotomy is false. States created markets, markets require states, and neither could continue without the other."

Really interesting piece.

I am amazed at how often I find people that believe that paying a mortgage on a house that costs more than they owe is a moral imperative, or simpy as 'the right thing to do'.

Why would you keep a promise to bank that would not do the same unto you? If you continue to pay on a house that is worth far less than your mortgage, you are giving the bank money to cover the mistake it made on you, while to a large extent, the bank has already been covered by tax dollars for that mistake. And, all the while, you are investing less in your retirement or other aspects of your life, making your total loss much larger than just the difference in your mortgage and the price of your house. Your mortgage was a deal made in a bubble. Both sides were wrong. Why should the banks get an out where homeowners don't? Walk away. Invest in your future.





AhimMoonchowsen  ·  4601 days ago  ·  link  ·  
I guess, for some the opportunity costs you mention aren't the only variables in play. Sure you aren't investing fully in other areas because you are over-paying on your home but the question is, is this worth it to salvage your credit score? For some, the answer may well be "yes". Sometimes it is practical to pay, but I do think doing so because you feel "ethically bound" is silly. It's already hard to secure credit, try doing so with a home default on your record.
mk  ·  4601 days ago  ·  link  ·  
I think if you're gainfully employed, and you don't mind renting for a few years, it's not too much of a loss. Credit scores are pretty ridiculous, IMHO. It's a game we are forced to play, and we don't get a say in the rules.
AhimMoonchowsen  ·  4601 days ago  ·  link  ·  
Sure, but it's a game we are FORCED to play. It could take a long time to get back in the "black" so to speak. If you have a business venture you are interested in etc, it could make things difficult.
mk  ·  4601 days ago  ·  link  ·  
Maybe. I recently had a collection agency calling me like crazy for $140 I 'owed' AT&T. After a big headache I found that AT&T charged me for 4 months of DSL at an apartment I moved from and canceled at. I even moved service to my new address! I never knew until a collection agency started badgering me 1 year later. The agency person kept telling me that it would hurt my credit score, but could produce no bill, and had no reason to give why I owed AT&T.

Every time they mentioned my credit score I had to laugh. I told them I have a house, a car and a credit card. Why should I care about my credit score? No good answer. Anyway, fuck AT&T for putting me through the trouble of correcting their mistake. In a fair world I should be able to bill them for the hours I wasted on their account. AT&T should have a score that I can lower.

Yeah, credit scores make me angry.

AhimMoonchowsen  ·  4601 days ago  ·  link  ·  
If you're looking for an argument to that post you're barking up the wrong tree. I couldn't agree more. My score was hurt by a 25$ co-pay to a doctors office I knew nothing of. I recently bought a house (put 20% down) and still got dinged at a slightly higher rate because of a 25$ bill I knew nothing of. A 25$ bill that potentially cost me thousands. -fuck them indeed!