US property owners walking away from debts as they can’t face rising negative equity,

[Nicholas Wallwork]

Many property owners who are struggling to pay their mortgages in the US are deliberately walking away because of rising negative equity even although they can still afford to pay.

The disturbing new trend has been uncovered by researchers at the University of Chicago’s Booth School of Business and Northwestern University’s Kellogg School of Management

They found that some 26% of defaults across the country are calculated economic decisions to bail out of loans by borrowers who could afford to make the monthly payments but can’t handle the negative equity caused by declining property prices.

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