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wl1193 · Joined: 30 Jan 2010 Posts: 3 2.38 Dollars($)

Hi. I just found this website a few minutes ago and this looks like a great source of information that I am going to sift through. Here is my dilemma.

We live in California. My wife and I sold a home in 2006 in the San Francisco Bay Area. That is where are from and that is where I work. We bought a home in the Sacramento area and I was going going to get a job in the area but that fell through. I have been commuting over 100 miles one way for almost 3 years. It has taken a toll on me and the family. I have a civil service job and the job market in the Sacramento area is grim. I have enough seniority where I work and I do not have to worry about being laid off. I do overtime but that is almost dried up. My wife may lose her part time job. The part time job and overtime gave us a teeny bit of cushion but that is going away.

We want to move back to the San Francisco Bay area and are trying to figure out what to do. Should we short sale the house? Go bankrupt? Foreclose? etc. We want out of the house and don't want to stay in the Sacramento area. My commute and never being home is really taking a toll on the family (in addition to the money problem).

We bought the house up here with a first and second mortgage for about 430K. We took out a 3rd loan (about 35K) for a swimming pool. We owe 25k in credit card bills etc. We have a great credit score now and realize it will take a hit. Will the 3rd hamper the short sale process? the home is in a fairly new development. Homes with the same floor plan are going for about 330K without the interior upgrades, landscaping or pool.

We are current on all our bills. We don't plan on trying to buy another home (or car etc) for a few years.

Any advice will be appreciated. I will go through all the posts to get more info. Thanks for looking.

sara · Posted: Wed Feb 03, 2010 3:14 am Post subject:

Hi wl,

You can definitely apply for a short sale with your lender. Depending upon your financial situation, the lender would let you know whether or not he would accept your request. However, you should remember that you would be liable to pay off the deficient amount resulting from the sale of the property. You would also be responsible to pay off the second and the third lender. As far as your credit score is concerned, it will get lowered by 80-100 points.

Take care.

Posted: Thu Feb 04, 2010 7:44 am Post subject:

Hi thanks Sara. I did a little more research. The first loan is serviced by Chase but owned by Fannie Mae for about $332,000. The second loan is owned and serviced by Chase for about $83,000. The second was a heloc to get us into the home. The third loan is through Key Bank and is about $32,000. This was a heloc to buy a pool. Brand new homes in my neighborhood with sme floor plan without any upgrades goes for about $320,000. I think our home with the upgrades, landscaping, pool, two tiki huts and bbq island grill can probably go for $340,000 (at least I hope it does).

If the house sells for about $340,000 the first could be paid in full. If the second was a loan to get into the house would that be non recourse? I live in California. I believe the pool loan would be non recourse. Can I offer to pay a partial payment to help speed up the short sale? Say $10,000 to pay off the second and third? Do the banks do this alot? Thanks again.

smithsussane · Posted: Fri Feb 05, 2010 12:48 am Post subject:

Hi Guest!

Welcome to forums!

As far as I know, the second loan can be considered as a non-recourse one. Thus, the second lender cannot charge you for the deficient amount resulting from the sale of the property. If you want to speed up the process of short sale, you can definitely offer partial payments to the lenders. However, it would be the lenders' discretion whether or not they would accept this payment.

Feel free to ask if you've further queries.

Sussane

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