Leaving Your Mortgage Will Now Result in Serious Goverment Penalties

Many of us were introduced to concept of "strategic default" when it was reported that the rapper Chamillionaire decided to walk away from the mortgage on one of his homes, rather than continuing to pay the high monthly cost. Homeowners across the country are making the decision to engage in strategic default, in large part because they are finding that the amount of their loans are now consistently more than the value of the home on which the loan was taken. Well, the government is now putting an end that.

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Best Rural Places to Live

No. 9: Obion County, Tennessee
Nobody knows better the value of a farm upbringing than someone who experienced it and is now passing it on. That's a common occurrence in this northwestern Tennessee county.

Paul Albright's family is the fifth generation of Albrights to live and farm here, and for Paul it's the only way of life he has ever known or wanted. "When I graduated from high school here, the decision for me to go to college was made as all decisions on the farm are made -- not by me, but by us all," he says. "My earning an ag degree just made sense." Now he is raising his family on the same land.
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Courtesy Progressive Farmer

AFP

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Best Rural Places to Live

No. 10: Madison County, Virginia
Forestry is big business in the county; 25% of its acreage lies in the Shenandoah National Forest. But the county makes good use out of its farmland too. The area consistently has one of the healthiest cattle markets in the state, and hay and row crops support the area's livestock industry.

As for the benefits of raising his children in the county: "It teaches them responsibility and the values of farm life," says Jerry Carpenter, third-generation dairy farmer. "It makes you humble sometimes and brings you down to earth. You can be on a high one year and then milk prices go down, and it's a dry year, so it keeps you kind of level."
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Best Rural Places to Live

No. 8: McPherson County, Kansas
If you're looking for enthusiasm about McPherson County, Kan., look no further than Jana McKinney, a Kansas State Extension agent for Family and Consumer Services. "The tradition of family is alive and well in McPherson County," she says. The community works to be sure that kids can be as active as they want in McPherson County around the farm, in town and on the athletic fields. The county's three local colleges are symbols to the kids that education is important and available to them. Economically, McPherson County relies on agriculture. In nearby Salina, huge grain elevators dominate the horizon and railroads carry wheat to all parts of the world.
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Best Rural Places to Live

No. 7: Oconee County, Georgia
Oconee County, Ga., has once again earned a top spot on our list. That's hardly surprising to its residents, who have remained steadfast supporters of family and committed to keeping their county rural. "The more people who move in looking for the peaceful rural life, the less rural it becomes," concedes Stan Mitchell, who operates a cattle farm in Farmington and teaches FFA. Things may be changing, but one thing is constant: good youth programs and schools. The FFA and 4-H programs are some of the best in the nation. In 2007, Oconee County Middle School was named Outstanding Middle School Model of Innovation.
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Best Rural Places to Live

No. 6: Fayette County, Texas
Fayette County, Texas, is prime cattle country. Yet, every rancher knows there are easier ways to make a living. But Clay Rightmer wouldn't have it any other way. "Everyone lends a hand taking care of the herd," says Rightmer, nodding his head in appreciation toward his wife, Jennifer, and children Lane, 16, and Reed, 13. Even Rightmer's parents, Harold and Billie, jump in to help. "Our children are raised with a good work ethic and that will help them excel throughout life," he adds. This is not the first time Fayette County has made our Top 10 list. It's a land of scenic beauty where winding country roads pass over gently rolling hills with century-old live oak and elm trees.
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Best Rural Places to Live

No. 5: Clinton County, Iowa
At its heart, Clinton County remains farming country. Mike McNeil , who farms outside Grand Mound, is like many of the 1,200 farmers here. He produces corn and soybeans. While Mike no longer produces hogs, Clinton County remains a fairly large hog-producing county. It also produces a good number of beef cattle.

Mike, married to his wife, Jean, for 22 years, can't think of a better place to raise his boys. "The farm life has been good. It may not be as physical as it once was, but you do learn about hard work and you learn about responsibility."
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Best Rural Places to Live

No. 4: Harvey County, Kansas
The south-central county is home to traditional row-crop and cattle farms, and ag industry; AGCO makes its home in Hesston. "People can live in our community and still be able to work here," says Extension agent Jonie James. The county works hard to preserve agriculture by maintaining roads, farmland and water quality. Another valuable resource is the youth programs. "It's a county with Midwest rural values where people are still putting families first and trying to give the next generation a spring start," says Nute Rucker, who lives on a farm in the area and teaches vocational ag at Newton High School.
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Best Rural Places to Live

No. 3: Ida County, Iowa
Like so many of his generation that grew up on an Ida County, Iowa, farm, Delayne Johnson graduated from college and moved away to start his career. But now he's back in an area fueled by agriculture, renewable energy projects and light industry. "My wife, Anne, and I want our children to live in a community where your neighbor will lend a helping hand whenever you ask," says the general manager of Galva Holstein Ag LLC. Helping others seems to come naturally to the people who live here in the gently rolling hills of northwest Iowa. Several foundations have been established to help fund everything from recreation centers to a new 384-seat performing arts center.
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Best Rural Places to Live

No. 2: Chippewa County, Minnesota
Missy and Chad Ochsendorf gave up their careers in the Twin Cities to move back and raise their kids on the family farm -- a farm that has been in the family for four generations. The family (Kaileigh, 16; Kami, 10; Alise, 8; and Jacob, 3) is active in 4-H, and they have cattle and horses to keep them busy with chores at home. "Home" is west-central Minnesota, a flat land of black earth, corn and soybeans. Hundred-year-old white churches with neat cemeteries dot the prairie, with historic evidence that Scandinavian and German Lutherans settled the land.
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Best Rural Places to Live

No. 1: Hamilton County, Nebraska
Welcome to Hamilton County, where small-town memories grow, and people work together to get things done. This is corn and soybean country an hour west of Lincoln in the flat and fertile Platte River valley. Irrigation makes sure the crops grow here, and the folks of Hamilton County do their best to make sure the bounty they produce stays here.
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Best Rural Places to Live

Government-sponsored mortgage purchaser Fannie Mae is now banning those who walk away from their mortgages from receiving financing from the agency for up to seven years after the date on which they decide to default. If the borrower works in good faith to work out a deal and proves that they don't have the capacity to pay, they are not going to be banned.

"Walking away from a mortgage is bad for borrowers and bad for communities and our approach is meant to deter the disturbing trend toward strategic defaulting," said Terence Edwards, executive vice president for credit portfolio management.

Fannie Mae has also announced that when the law allows, they plan to take legal action to obtain outstanding loan balances from those whom they believe to have strategically defaulted. Their servicers will be monitoring loans to determine who may have broken the law, and making recommendations on which borrowers to pursue.

A spokesman for Freddie Mac, the other government-backed mortgage agency, said that it's going to investigate the new policy sponsored by Fannie Mae and make a determination regarding whether or not they'd like to pursue similar action.

The moral of the story? If you have the ability to pay, realize that there might be serious consequences for not doing so. Also, the damage to your credit rating may not be worth the risk, especially when dealing with real estate prices that are likely going to bounce back.

Dr. Boyce Watkins is the founder of the Your Black World Coalition and the author of the new book, "Black American Money." To have Dr. Boyce commentary delivered to your email, please click here.