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 carenzafamily
Joined: 01 Sep 2008
Posts: 3
2.19 Dollars($)
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 Posted: Mon Sep 01, 2008 9:36 pm Post subject: foreclosure question see details |
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| My house is in pre-forclosure. We live in FL. Due to market crash home is worth less than we owe. We do have pmi. Mortgage is in gma's name alone. Title: g-ma hubby and I. Gma died in Jan 2008. We bought house in 2005. She was supposed to be co-signor, but mortgagor agent arranged paperwork under gma's name entirely. We have lived in house and made all payments since the purchase 3 years ago. She lived with us on and off when she visited Fla. When she lived in MI she was in an assisted living facility in Mich.Deed says we own property when she died, but we never changed mortgage to our name. The house is 28 years old. We owe 183,000. market value is 135,000. However similar houses are selling for less then 100,000. My mortage payment is 2000 a month. I can rent a home that is 4 times nicer for 1/2 that price. There is no way we can afford the mortgage let alone cover the past due payments. foreclosure seems our best bet. Will this affect our credit? will it negatively affect gma's estate? what does a foreclosure affect besides taxes and credit? |
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jameshogg
Joined: 20 Dec 2005
Posts: 1812
Location: nevada
268.37 Dollars($)
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| Posted: Mon Sep 01, 2008 10:22 pm Post subject: RE: foreclosure affects credit |
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Hi carenzafamily,
Welcome to forums.
You should have changed the mortgage in your names. Does the lender know that your grandmother has passed away and it's you who's making the payments. The lender may ask you to refinance the loan in your name.
What I'd like to ask is whether your grandma went for a reverse mortgage? If so, the lender would take away home after her death and sell it in order to retrieve the unpaid debt. Any extra proceeds would be left to the heirs (you and your husband). However, if you and your husband pay off the loan, then you'll be able to keep the home.
| Quote: | | Will this affect our credit? |
Foreclosure drops down your credit score by 250 points or so. Know more...
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carenzafamily
Joined: 01 Sep 2008
Posts: 3
2.19 Dollars($)
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| Posted: Mon Sep 01, 2008 10:37 pm Post subject: If the mrtg is not in my name how can it affect my credit? |
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| The mortgage is not in my name at all. no reverse mortgage. the house was ours, but the mortgage was hers. she was on title because mortgage was on her credit. we really cant afford to pay off loan. |
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helping_user
Joined: 31 Mar 2006
Posts: 803
Location: Hawaii
149.73 Dollars($)
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| Posted: Mon Sep 01, 2008 11:36 pm Post subject: RE: short sale or deed in lieu |
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Hi carenzafamily,
If you cannot afford the loan any more, why don't you take the PMI coverage from the insurance company? or is the policy in your grandma's name?
You may go for a short sale but it won't help you recover much. But the effect on your credit will be far less negative as compared to something like deed in lieu (dil). Then there is the deficiency judgment which would require you to pay off any remaining debt after the sale. And in case you can't pay, there'll be tax consequences too unless the lender forgives the debt.
To know about credit effects of dil and short sale , refer to the information available on this topic.
Thanks. |
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