Was this for privately owned homes or timeshares?
I heard an interesting program on NPR a few months ago. They were interviewing two families who were upside down on their mortgage. One couple, a military family, couldn't sell their home after the husband was relocated to another city, without having to write a hefty check to the bank. So the husband and wife/children were living in two different cities. He flew home to see them twice a month if he could get a cheap flight.
The other homeowner, a childless couple, decided to walk away. The interviewer asked him if he felt that it was unethical to do so. His answer was basically, "If I was a company instead of an individual, would you feel it was unethical for me to go out of business? Because that's what I've done. I don't want to lose money any more. That would be stupid."
It was privately owned homes.
Anytime you owe money and have the ability to pay but refuse, you're on the hook. Car loan, home loans, credit card loans et......it doesn't matter.
As an example, in the mid 80's I was divorced from my wife. She kept the new car and the loan that went with it. She failed to make the payments, the car was repoed and Ford Motor Credit then sold the car at auction for a loss (She had wrecked the car and had not had it fixed). They then came after me for payment of the difference since my name was still on the loan. In the end, that's what tipped the scales and put me into bankruptcy.
Sure I had a divorce decree that set out her obligations but, when she didn't pay them I was still responsible for them and, according to the lawyer, I had to pay them, then go after her in court for reimbursement.
If you owe the money, you can always walk away but the lein holder has legal remedies to use. It's up to them to decide if it's worth the expense of getting a judgement.
Walking away isn't as easy as the news media often makes it out to be. There are people who have walked on a mortgage because they were upside down, only to find out down the road that, when the bank sells the home at a loss, they're still responsible for the balance.
In this case, the assessment falls before the default. I would be afraid if an owner walks and, if DRI deems it resonable to seek a judgement, then the owner (former owner if the deeded week was foreclosed on) could still be held liable for the fee's if they had the reasonable ability to pay them.
The trick here is, will DRI spend the money going after those that default and, would there be a ressonalbe chance DRI would be awarded the defaulted fee's PLUS any fee's associated with getting the judgement?
Before walking, it might be worth paying an attorny to see what the consequences might be. I'd hate to get blind sided a year or two down the road by a legal judgement that either had to be paid or, file bankruptcy to avoid.
I'm not expert. I'm just saying this is something I'd be concerned about based on my past experience.........which occured in the mid 1980's. Things change and I could be a long way off base but, it's something I'd want to make sure of rather than feel self assured it was a done deal if I just didn't pay.
