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17% of all homeowners who defaulted in the 2008 mortgage crisis walked away strategically https://www.city-journal.org/article/the-menace-of-strategic-default#:

17% of all homeowners who defaulted in the 2008 mortgage crisis walked away strategically https://www.city-journal.org/article/the-menace-of-strategic-default#:~:text=The%20study%20estimates%20that%20in,to%2040%20percent%20in%20California https://www.city-journal.org/article/the-menace-of-strategic.... I distinctly remember stories on NPR during the crisis that browbeat homeowners who did this or thinking about doing this, claiming it was “unethical”. It’s the same story with companies that ask for loyalty then lay off with pleas towards efficiency. It’s always business, whenever someone plays towards my emotions in financial deals I want to shake them.

jeffbee 3y ago
> 17% of all homeowners in the 2008 mortgage crisis walked away strategically That is a quite misleading restatement of the facts. 2 of 144 million homes in the US were foreclosed in 2008, and 17% of those were deemed "strategic". That's 0.2% of homes.
- monero-xmr 3y ago
  I meant of defaults total of course. I edited the comment
nerdponx 3y ago
The article title is pretty funny. The menace of people taking advantage of a system that's been taking advantage of them all along!
wharvle 3y ago
> I distinctly remember stories on NPR during the crisis that browbeat homeowners who did this or thinking about doing this, claiming it was “unethical”. Whatever one thinks of the rest of the book, everyone should internalize the part of Graeber’s Debt in which he explains that connecting moral duty to personal debt under impersonal capitalism (if not, perhaps, to debt owed someone you know) is grade-A bullshit. It’s just business. Make the move that is best for you, period. Sometimes that’s default! It’s probably nice for lenders if people believe there’s some moral duty attached, but that moral duty is only ever gonna go one way, so don’t fall for it. They’re not doing you a favor. It’s business. They make profit because there’s risk.
- FireBeyond 3y ago
  > It’s probably nice for lenders if people believe there’s some moral duty attached And this leads to immoral decisions on the part of lenders/creditors/debt collectors, the most obnoxious of this is hospitals etc., leaning on (if not extremely heavily implying legal responsibility to) families of people who have passed away to assume responsibility for their medical debt, because their loved one wouldn't have wanted to shirk it, or some such bullshit.
  - wharvle 3y ago
    Totally. I’ve known credit card companies to pull the same shit—deceased was the only one on the account, call and try to get relatives to assume the debt, implying that they have to, and trying to shame them into it if that doesn’t work. I bet it works often.

jeffbee 3y ago

> 17% of all homeowners in the 2008 mortgage crisis walked away strategically That is a quite misleading restatement of the facts. 2 of 144 million homes in the US were foreclosed in 2008, and 17% of those were deemed "strategic". That's 0.2% of homes.

monero-xmr 3y ago
I meant of defaults total of course. I edited the comment

nerdponx 3y ago

The article title is pretty funny. The menace of people taking advantage of a system that's been taking advantage of them all along!

wharvle 3y ago

> I distinctly remember stories on NPR during the crisis that browbeat homeowners who did this or thinking about doing this, claiming it was “unethical”. Whatever one thinks of the rest of the book, everyone should internalize the part of Graeber’s Debt in which he explains that connecting moral duty to personal debt under impersonal capitalism (if not, perhaps, to debt owed someone you know) is grade-A bullshit. It’s just business. Make the move that is best for you, period. Sometimes that’s default! It’s probably nice for lenders if people believe there’s some moral duty attached, but that moral duty is only ever gonna go one way, so don’t fall for it. They’re not doing you a favor. It’s business. They make profit because there’s risk.

FireBeyond 3y ago
> It’s probably nice for lenders if people believe there’s some moral duty attached And this leads to immoral decisions on the part of lenders/creditors/debt collectors, the most obnoxious of this is hospitals etc., leaning on (if not extremely heavily implying legal responsibility to) families of people who have passed away to assume responsibility for their medical debt, because their loved one wouldn't have wanted to shirk it, or some such bullshit.
- wharvle 3y ago
  Totally. I’ve known credit card companies to pull the same shit—deceased was the only one on the account, call and try to get relatives to assume the debt, implying that they have to, and trying to shame them into it if that doesn’t work. I bet it works often.