Lose Your Job?  We’ll Pay The Mortgage


Every day it’s another one. First Toll Brothers , then Lennar , then Cousins Properties announces it is the first and only developer that removes the threat of foreclosure if a buyer loses their job in the next three years. Last week Riverstone of Greenwich claims it will “protect your purchase price for up to a 10 percent market decline OR provide housing payments due to a job loss.”

Now I have to ask, do these companies honestly believe that this is a good idea? Yes, it may help assuage some buyer trepidation, but doesn’t it run the risk of drawing in buyers who might be more in danger of losing their jobs than average? And if, in fact, we see significantly more job losses, how are these guys going to make any money when they’re suddenly paying everyone’s mortgage?

It’s not that I don’t understand enticements. I think that for the car companies, it was a good idea, because they’re looking at much lower price points and therefore much lower risk. But these are homes, not cars, and frankly it feels a little fiscally dicey to me to market homes to buyers who might be on the margins of financial stability. I doubt the offers are going to make any difference to anyone who is secure in their job and income.

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