Choosing to walk away from a mortgage

The New York Times had a very interesting article a few days ago about homeowners who are able to continue making mortgage payments but walking away (and letting the bank foreclose) now that their home's value has declined. It's a hard statistic to measure, but according to David Streitfeld, "New research suggests that when a home’s value falls below 75 percent of the amount owed on the mortgage, the owner starts to think hard about walking away, even if he or she has the money to keep paying." The article presents a few scenarios as well as what could happen to the fragile economy if many more American homeowners decide to do this. Even more interesting to me were the reader comments debating the ethical and economical repercussions (I read the "highlights" of the reader comments).

One reader wrote in:

"That secured value changes, most contracts state that non-payment will result in foreclosure (they get the asset). It seems to me like the one who made the bad bet is actually the lender, not the house owner.

If I didn't think that the house would recover its value for 5 or 10 years, I'd give the asset back to the lender. Its my contractual right written in there in the contract drafted by the lender. I think everyone in this situation should do this (its what companies do) and it is financially astute to do so in the long run unless, of course, you think that paying 150% of the going asset price (the mortgage you pay as opposed to the rent you would pay) is financially astute!"

Another argues "What's sad is that we have become a lawless society devoid of any consequences no matter how egregious the offense. I'm not saying these people are wrong for walking away, banks would and have reneged on their agreements. But ultimately we all pay, with tax dollars and our integrity."