Just Walk Away, Renee…

“Just walk away, Renee, you won’t see me follow you back home…” If you’re a fan of the rippin’ retro Sixties, you may know the group Left Banke, who did a haunting, wistful song called “Walk Away, Renee.” Alas, however, the Mortgage Bankers Association tells us, a whole lotta homeowners (or, I guess, former homeowners) are doing that very thing.

Foreclosures in the U.S. hit an all-time high at the end of 2007, with borrowers holding adjustable-rate loans walking away from their homes even before the payments went up, Bloomberg reported, based on the MBA study released today.

Apparently, people are ditching their properties even before the interest rate goes up because they couldn’t afford the home in the first place, said Jay Brinkmann, vice president of economics and research for the industry organization.

Late payments have zoomed to a 23-year high, the MBA said.

Readers, help me out here. Put yourself in the shoes of someone who bought a house they couldn’t afford. Let’s say the clue bat has just descended upside your head, you came up short two months in a row and you know you can’t make the mortgage payment next month. What exactly do you DO?

Is there a smart thing to do at this point? Or at least a relatively smart thing? If you cannot imagine yourself doing something this stupid, what if you found out your best friend, or your mom (this actually happened to someone I know) has done it, and they need your advice?

Should they walk away? Should they contact the lender? Do you have to flee in the dark of night so the lender doesn’t find out?

And while we’re thinking about foreclosures and their effects, here’s a list of rather shocking price reductions in Antioch and Pittsburg, the areas of CoCo County hardest hit by the mortgage mess. It’s one thing when a luxury home takes a huge hit, but the first house here was $475,000 and dropped to $375,000.

634 Charleston Street, Pittsburg: 4 bedrooms/2.5 baths, 1,867 square feet, was $475,000, now $375,000. Fireplace, breakfast nook, back yard, lots of space. The listing does not say it’s a foreclosure, but does say there are “other disclosures,” and there’s no photo, always a quizzical sign.

1540 Freed Circle, Pittsburg: 3 bedrooms/2.5 baths, 1,535 sq ft, was $334,900, now $299,900. Unlike the preceding listing, this has photos, and though it’s a foreclosure, it’s quite clean and presentable inside and really pretty outside.

1600 Norton, Pittsburg: 2 bedrooms/1.5 baths, 1,757 sq ft. Was $355,000, now $305,000. No photo, always a worrisome sign, but the listing doesn’t say anything about foreclosures. Seems like the place could have promise, with all that square footage.

1550 Norton Street, Pittsburg: 2 bedrooms/1 bath, 864 sq ft, was $176,900, now $168,300. This is a really shocking price for the Bay Area. Admittedly, the house is a bit goofy-looking, at least to me, and it’s a foreclosure and the ad bear the ominous warning, “Just needs a little TLC,” which is a bad sign. But still, $168,300 in the Bay Area is a number I haven’t seen in about eight years.