Abandoned. When a borrower cannot afford to make mortgage payments and the value of the property is less than the amount of the mortgage, the lender will often foreclose. The borrower has no option to refinance and may be unable to secure the lender's agreement to writeoff the balance of the loan after a sale. In that situation many will abandon the mortgaged property and allow the lender to take it.
Abandoned properties and the resulting declining home values contribute to the specter often seen on TV of blocks of vacant houses.
Related Fool Articles
Recent Mentions on Fool.com
- Why Warren Buffett Thinks You Can Beat Him in Today's Stock Market
- 5 Things SolarCity Corp's Management Wants You to Know
- OPEC Considers Emergency Meeting On Oil Prices
- The 3 Best Small-Cap Tech Stocks to Buy Now
- U.S. Silica Holdings Inc.'s Excellent Earnings Eclipsed by Guidance
- Why Wall Street Hates Outerwall