Facing foreclosure, mortgagors who have loans that exceed their property value often have a sense of hopelessness and "nothing to lose." These mortgagors simply leave the property, something that is likely in an underwater mortgage because they have so little to lose. Their credit rating is affected, but they no longer have the payments or the worries of maintenance. In some cities, mortgagors who have abandoned their homes have stripped the property of everything from the stove to the copper plumbing. The federal government has set up special task forces to try to stop the stripping of properties by mortgagors.

Most mortgage agreements require the mortgagor to maintain the property in livable condition, but again desperate times bring desperate actions. Also, taking items from the mortgaged property is not theft unless and until title has been taken back through the foreclosure process. Stripped and abandoned properties bring down the value of neighborhoods and result in increased crime levels. Areas with high levels of abandoned properties now unoccupied and held by lenders that are unable to sell them have been labeled "foreclosure ghettos." In cities with high foreclosure rates, "walk-aways" and stripping have resulted in urban blight in certain areas. Cities are passing ordinances that require lenders to maintain the abandoned properties or are actually taking back the properties through eminent domain so that the abandoned homes do not become drug houses or residences for the homeless.....................

Discussion Questions 1. Does the fact that many are walking away or selling their properties through "short sales" (a sale of the property below the mortgage amount that is approved by the original lender) make it ethical for all owners to do the same?
2. List who is affected by a decision to walk away.