Who Defaults on Mortgages Most?

An interesting article was in this mornings New York Times. The articles screams forth, "Biggest Defaulters on Mortgages Are the Rich." According to the article, the majority of homes in foreclosure isn't the poor slobs that lost their job last year and now are losing their hoes to. Instead it is those that are rich.

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.
- New York Times

The article suggests that the rich treat their mortgages like any other investment. That is dumping any financially draining properties.

Though it is hard to prove, the CoreLogic data suggest that many of the well-to-do are purposely dumping their financially draining properties, just as they would any sour investment.

“The rich are different: they are more ruthless,” said Sam Khater, CoreLogic’s senior economist.
- New York Times

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