They have a new word for what happens when people just mail their house keys to the mortgage company: trashout. Firms specialize in clearing furniture, trash, and the rest of the stuff out of the house when people abandon it. And it looks like a growth industry:
From the Wachovia conference call:
“Part of one of the challenges is, and we've mentioned this before, a lot of this current losses have been coming out of California and it's -- they've been from people that have otherwise had the capacity to pay, but have basically just decided not to because they feel like they've lost equity, value in their properties, and so in a way, we may have -- it's hard to know right now, but we may have seen somewhat of an acceleration problem loans as people have reached that conclusion and we're just going to have to see how the patterns unfold here.”
emphasis added
Some fret about the morality of borrowers just walking away, but Atrios wonders why they're criticized for acting rationally, like a corporation:
I know some will find walking away from homes morally unsettling somehow, but I don't see what's wrong with people behaving as businesses would. It's the fault of lenders for not ensuring that people had skin in the game by requiring reasonable down payment levels.
...and, adding, if the banks hadn't lobbied for the awful Bankruptcy Bill more of their customers might be choosing that route instead.
Somtimes it's worth remembering that people, like corporations, are people too.
Are we going to see abandoned homes roving the countryside in feral packs?
Posted by: tata | January 23, 2008 at 10:06 AM
No doubt, tata, followed by posses of homeboys, wranglin' them dogies into herds of homes, and lettin' them graze on subdevelopments. Oh, shore, they be a few mustang ranches, but fo th mose part, they'll line up, you bet.
Another odd phenomenon we're seeing in the credit markets is people defaulting on their mortgages but not on their credit cards. That's never happened before on such a grand scale.
Posted by: actor212 | January 23, 2008 at 11:41 AM
Oh right! Fix the post after I comment, but do you credit me????
NNNNNNNNNNNNOOOOOOOOOOOO!!!!!!!!!
Posted by: actor212 | January 24, 2008 at 09:40 AM
"Somtimes it's worth remembering that people, like corporations, are people too." People, people who neeeeed people, are the luckiest people in the world!
Posted by: mandt | January 24, 2008 at 10:51 AM
There are people who will make a lot of money at the end of all these. Already my man in the Wall Street has paid himself a thumping bonus due to all this. His cousin is waiting in the wings. I thought you guys are savy to all these as you come from a more educated places than we Brits.
Posted by: alwaysshariff | February 01, 2008 at 09:32 AM
I think it is a good blog and I am in agreement with the comment posted by tata.
Posted by: hypotheek company | March 06, 2009 at 03:59 AM