The Mysterious Trustworthiness Of Underwater Homeowners

Felix Salmon points to an anomaly in the results of the latest National Housing Survey by Fannie Mae.

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According to the survey, people with underwater mortgages—where the amount owed on the mortgage exceeds the value of the house—are less likely than the general population to say that walking away from a mortgage is acceptable.

“Underwater homeowners are significantly less tolerant of the idea of walking away from a mortgage than their more solvent peers: just 6% of them say it’s OK to stop paying their mortgage, compared to 10% of the population as a whole,” Salmon writes.

This is at least a bit surprising. Wouldn’t you expect the self-interest of underwater homeowners to push them toward support for strategic defaults? And wouldn’t you expect people who aren’t in that position to be less sympathetic to walking away?

What’s going on here?