Quote:
Originally Posted by Lindy
Lots of questions here.
Is stealing ethical, as long as you only steal from the very, very, rich financial institutions?  How about if it is your local credit union?
If it's OK to steal from the very, very, rich and give to the poor, a la Robin Hood is it then also OK to steal from the very, very, rich and keep it for yourself?
Did the very, very, rich financial institutions not (with heavy government encouragement) write risky mortgages with risky terms for risky people that shouldn't even have been buying homes and then seek to sidestep that risk?
Lindy |
Strategic defaults aren't stealing, so your questions don't really make sense.
I'm not saying that strategic defaults are always justified, or that the wide scale use of SDs would be a good thing for the housing market- though it might force banks to be even more vigilant about who they give loans to, which might not be a bad thing. What I am saying is that I don't find SDs ethically questionable.
I don't have an MBA, but I'm fairly certain that the act of ceasing loan payments subjects a person to the applicable penalties set forth in the loan agreement and that these penalties are meant to deter defaults (whether strategic or not). So, provided a person is acting within the scope of their loan agreement, i.e. if payments cease, the bank gets the house, I don't see what the problem is. I wouldn't begrudge a bank using their power within the scope of the law to get what's theirs according to the agreement.
For instance, if I stop making car payments, my bank will take my car (along with some other unpleasant things- probably no more free checking
) because that's the agreement I have with them. There isn't necessarily anything immoral about me exercising the "I stop paying and you get my car" part of our agreement. Capitalism is amoral, right? There certainly isn't anything illegal about me defaulting. Further, if they're doing their jobs, they should be charging interest rates at levels set to absorb my default and make a profit on their collection of loans in the long run.
I think it's interesting how some folks sense of personal worth and responsibility are extended to agreements with organizations designed to squeeze from them every last drop of available money. It's like a hooker not wanting to rip off his/her pimp out of some sort of sense of honor. Clearly, your bank won't think twice about ripping you off at every turn via adjusting the sequence in which your checks clear or charging you money to access your money. This is because not only does your bank understand that it can subject you to the terms of whatever fucked up contract it can get you to sign, but it also isn't beholden to quaint notions of interpersonal responsibility and honor.