Atlanta Foreclosures - They're Just Walking Away!

There is a lot of recent reports of dramatically rising Atlanta foreclosures bank owned properties and REO's due to persons just walking away from their Atlanta homes.  I think this is more than a real estate story, it is a sad commentary on a personal lack of values, judgement, commitment and character!  It isn't just about them, it is the damage to society and our economy that will be left in its wake.  The burden will not end when the door closes behind these folks! It is just a bad ending for them, and a very bad journey for all in the community. 

There is a looming tsunami of mortgage resets taking place right now in Atlanta and across the country.  The problem these days are re-sets from adjustable rate mortgages, and interest only loans whose new payment falls far beyond the reach of the ability to repay the loan.  This is in stark contrast to the mortgage failures in the 1920's.  The mortgages back then were balloon notes that required 50% down payments!  Homeowners finally capitulated back then and walked away after they could no longer make payments, but it was job losses and layoffs that lead to the inability to pay.  That is in stark contrast to today's market.  To acquire Atlanta homes required no money down, no closing costs, and no commitment of the home buyers.  When the going gets tough, the tough get going.  It really makes you wonder if anyone was thinking?  No one was reading their mortgage obligations, documents, financial disclosures, Truth in lending statements ad nauseum.  Whatever happened to personal responsibility?  A person that just walks away from a major obligation remains a burden for society and community long after the act.  Neighborhoods decline, your neighbor loses equity, and I assume you lose your dignity for some time to come.

When you think of the current surge in a time where there is supposed to be a voluntary moratorium on new foreclosures... could you imagine if there wasn't a moratorium?  So where did all the new foreclosures come from?  In Atlanta Georgia foreclosures jumped from 7600 in January to a new high of over 10700 new foreclosures in Georgia in February.  That is 4 to5 times higher than our current sales of homes in Atlanta.  In January in the entire Atlanta metro area only 2401 homes were sold, in February it is shaping up to be less than 1500 single family homes sold.  I hate to see where the new Atlanta foreclosures rates will be once the moratorium is lifted.  I think it will be unfathomable even to imagine.

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