You Decide – Should you walk away from an underwater mortgage?

Here’s the latest from our series of You Decide activities at KQED – designed to question your assumptions on economic issues.

With talk bubbling up lately about whether people who are underwater should just treat their home as a bad investment and simply walk away, we decided to take a look at Case-Shiller values over the last 20 years or so. Some markets appear to have climbed back toward their previous peak values – enough that your home might still be a good long-term investment. Other markets look like they have a long way to go, especially if you bought close to the peak.

In researching the topic, I found that a lot of commentary was ignoring the fact that you might live in a recourse state, where the lender can claim more than just your house if you walk. So the map also shows which states allow recourse, and which don’t.

You can find the full activity (discussion, links, embed code) here. If you just want the interactive that I embedded above, you can grab it here.