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Homeowners walking away from homes

In cities and towns big and small throughout the U.S. homeowners are walking away from their homes as foreclosures rises along with the rate of unemployment. It is the new “bail out”.

According to mortgage experts, this growing trend in the real estate market is largely due to the deficiency statues in some states, prohibiting lenders from suing mortgage borrowers for the balance due on the mortgage after foreclosure. The Non-recourse states include Texas, California, Washington, Arizona, Alaska, Connecticut, North Carolina, Utah, and Idaho.

“There are some folks suggesting that state anti-deficiency laws should be expanded around the country as a response to the mortgage meltdown,” said North Carolina attorney Donald Lampe.

The nation’s foreclosure storm has hit 4-million homes and is forecast to worsen in 2010. Americans are not happy. They have watched their government spend trillions of dollars on Wall Street bailouts, which hasn’t shown any relief to the problem.
A deteriorating economy is the force driving the homeowners’ bailouts. The cost of living in the U.S. exceeds salaries by a large margin. The affordability gap has grown because property prices have risen three to four times faster than salaries in the past decade. Mortgage and rent payments are making up the biggest share of take-home pay. Americans are strapped for cash, turning to their savings and retirements to survive difficult times. 

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