surrender home?

Guest 0.10 Dollars($)

I purchased my home about two and a half years ago . It was a fixer upper and I have put about 50k in some renovations. took out some money through a refi - and took the adjustable , interest only option. It adjust in four years. Here is my problem - WE really need more space and have tried to sell to no avail....... but here is the clincher...after noticing my floor seemed to sag a little I investigated under the crawl space and discovered moisture rot throughout the home..meaning major surgery to my home-big bucks.... on top of that i had turned my seperate garage into an apartment to make ends meet..not really allowed in my county. I feel like I am drowning. The good news is I do have excellent credit, but I feel I should consider turning in the deed. Any suggestions would be appreciated.

jameshogg

Hi Southernmetal,

Welcome to forums.

If the hoiuse isn't in good condition, then it won't sell easily and perhaps it won't sell at all. So, I think you will again have to do some renovation. But this means, you need money again. And you have already refinanced once.

Now, I don't remember the name but there are companies which buy homes that aren't in good condition and then they repair them and sell them off. You may not get the sale price as it's worth but at least you have a way out to pay off the mortgage to some extent and if possible you can use some of your savings or investment cash into paying off the rest.

Thanks

gmakerley · Posted: Tue Dec 18, 2007 8:59 am Post subject:

"turning in the deed" will change your reference to excellent credit. you're in a box, but it would seem to behoove you to maintain as best you can, while making repairs as quickly as possible.

michelle · Posted: Tue Dec 18, 2007 7:06 pm Post subject:

Welcome to the forum southernmetal,

George is correct. Turning in your deed will surely cause a drastic drop in your credit. The lender may not even agree to accept the deed.

Have you reviewed your insurance policy to see if the damage may be covered? It is doubtful that it wil be covered, but I feel you should at least check to see.

Also, you mention that you need a larger home as well. Since I am not familiar with all your details, this option might not work either. You might want to speak with a lender to see if you can apply for a rehab or construction loan. The rehab loan would allow you to fix the home. The construction loan may permit a large addition or tear-down and rebuild on your current home site.

Have you contacted the county to see they would grant a conditional use permit or variance for the apartment? If not, you might want to consider doing so.

Best of luck. Please let us know if you have any further questions.

Guest 0.10 Dollars($)

I found out it will take about 60k to do the repairs and add the space we need. I have 45k in savings that I really didnt want to touch . The house is allready mortgaged beyond its value and what I could afford. I do have a 45k heilock 2cnd I havent tapped into yet but that would raise my monthly even that much further. The housing market has dropped around here (as everywhere) so when I look at the listings and see that I could get more house for less money I ask myself do I really want to dump more money into a problem house. What do you guys think of renting the house out after repairing the floor and purchasing another home ? It would meen having two renters on my property - a very big potential problem for me. -or could I do a short sale before or after buying another home.

larry · Joined: 27 Jun 2007 Posts: 3263 463.26 Dollars($)

Hi southermetal,

I have given you answer of the same question at- http://www.mortgagefit.com/predeal/about9603.html#39910

you can check it out.

Feel free to ask if you have any further questions.

lisascherzer · Joined: 04 Jan 2008 Posts: 599 69.58 Dollars($)

Southermetal,

Is the home worth less than what you owe on the mortgage?

gmakerley · Posted: Mon Jan 14, 2008 11:33 am Post subject:

lisa, she mentioned that earlier; and the answer is "yes."

as for the possibility of finding another tenant, that is a viable possibility for you, though you already recognize the headaches that come with being a landlord.

one way in which you can prescreen potential tenants is to have them run their own credit reports along with their scores. this will give you a better idea of who you are dealing with and their creditworthiness.

you could then use your savings to assist you in the purchase of a new primary residence. given your substantial investment in this property and the market as it is, this would seem a fairly reasonable solution.

walking away from the house is not a good idea.

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