More homeowners are walking away from their mortgages, even if they can keep up the payments. Falling into foreclosure — voluntarily or not — has become less taboo for many people as they have watched their house values tumble far below the amount they owe, putting them "underwater."
Purposely defaulting on a mortgage, often called "strategic default," may be a very rational personal finance decision, but it's not without major consequences. And it's not necessarily the best option for anyone underwater who can afford to make monthly mortgage payments but who does not want to wait up to 10 years for the housing market to turn around.
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