Biggest Defaulters on Mortgages Are the Rich

[Maine-ah]

http://www.nytimes.com/2010/07/09/business/economy/09rich.html?src=mv

LOS ALTOS, Calif. — No need for tears, but the well-off are losing their master suites and saying goodbye to their wine cellars.

The housing bust that began among the working class in remote subdivisions and quickly progressed to the suburban middle class is striking the upper class in privileged enclaves like this one in Silicon Valley.

Whether it is their residence, a second home or a house bought as an investment, the rich have stopped paying the mortgage at a rate that greatly exceeds the rest of the population.

More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.

By contrast, homeowners with less lavish housing are much more likely to keep writing checks to their lender. About one in 12 mortgages below the million-dollar mark is delinquent.

[T Wolf]

1. Poor, deprived people... What can WE do to save them from this disaster? Obama better

stop worrying about jobs and get to work on this crisis right away!

Maybe a program of debt-forgiveness directed at these more-worthy citizens.

[leveymg]

2. "Strategic default" is a mortgage industry meme, like the one that folks "walk away" from homes.

The "walk away" meme first emerged about the time of Obama's election, the strategic default meme is a more recent follow-up that reinforces the original. The desired effect is that when people see a "Foreclosure" sign, they no longer think of dislocated families - they envision some greedy investor who walked away from a strategic investment.

That's how advertising, PR and political messaging works - to shift the frame of reference. This, unfortunately, is a particularly successful example.

It's shocking to see some people spreading it here on DU, knowingly or unknowingly propagandizing industry talking points.