A strategic default is the decision by a borrower to stop making payments (i.e., to default) on a debt despite having the financial ability to make the payments.
This is a decision made by some homeowners after a substantial drop in the house’s price such that the debt owed is (considerably) greater than the value of the property — the property has negative equity or is “underwater” — and is expected to remain so for the foreseeable future, such as following the bursting of a real estate bubble.
Not all lenders will accept short sales or discounted payoffs, especially if it is financially smarter for the lender to foreclose. If you’re wondering what is strategic default or considering a Chandler strategic default, contact Chandler Arizona Short Sale Realtor Jason Dawson today for a no obligation, private consultation to learn about all your options.
Sometimes what is strategic default and a short sale is not your best option but we can help educate you on all the different options that are available to you.