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I am getting to the end of my rope. I currently own a house with my ex-husband. We owe way more then the house is worth. He no longer lives in the house and I do not want to stay in it. I have put it on the market for much less than what we owe. It has been on the market for about 6 months ( I have changed realators and dropped the price)
I recently got laid off. The Ex is no longer helping with the payments and doesn't care if it goes into foreclosure. I have had shoulder surgery. I can't afford the payments and DO NOT want to stay in the house at all.
I have tried to rent it with no luck. I am current on my mortgage but when I call the mortgage companies to tell them I will not be able to pay them and can we work soemthing out, I am told that they can't talk to me about options until I am late on my payment.
I do not want to ruin my credit but I want out NOW! The Ex doesn't want the house either and is not helping financially at all.

What can I do to get out now?

What are the affects of a foreclosure? It feels like that is a better option to just be able to move away from the house/the ex and be done with it.

I am extremely frustrated as my whole life is on hold because of the house.

Thanks for letting me vent and I would appreciate any advice anyone may have.

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Hi Coolchick,

Welcome to the forum.

You have mentioned that you owe more than the value of the house and you can no longer afford the payments. In that case, why don't you try for a short sale? By accepting this process, the lender will allow you to sell the house at an amount which is lesser than what you owe and will forgive the remaining debt. But he may seek a deficiency judgment for the difference between the sale amount and the debt amount. This will help you to avoid the foreclosure which has a far damaging impact on your credit report than a short sale and also lowers the score. The derogatory remark of foreclosure will remain on your credit report for 8 years.

BTW, have you not asked your lender of any loss mitigation plan? He can help you with a suitable plan. To know more on loss mitigation plan, you can refer to http://www.mortgagefit.com/loss-mitigation.html

Guest

larry if he does a short sale, then he won't be doing the right thing. because as it is she owes more than the value of the house. and in a short sale you don't get equal to the home price, so if she owes more she will have considerably large amount of debt to pay. and i doubt whether the lender will forgive the debt because currently the market is in a crisis which is making lenders get back their invested money otherwise it will be difficult for them to cope up with the tension.

"BTW, have you not asked your lender of any loss mitigation plan?"

As far as loss mitigation is concerned, i feel she as also talked to the lender and they aren't ready to work out.

wildstorm_films · Joined: 22 Aug 2007 Posts: 130 8.74 Dollars($)

Is a loss mitigation plan something like a foreclosure bail out program or are they 2 different things?

sara

Hi Wildstorm,

A foreclosure bail out program involves taking out a refinance loan in order to pay off the current loan under default. But a loss mitigation plan includes different ways (repaymnet plan, partial claim, deed-in-lieu etc) by which a borrower can avoid foreclosure and thus save his home.

Hope I was able to explain.

Take Care

carnahandavid · Joined: 21 Dec 2006 Posts: 238 58.41 Dollars($)

Coolchick

In your divorce judgment who was given the house? You or him?

If he was given the house and is not making the payments then take him to court for that.

But if no decision was given on the house or if it is in your name then I can't see how you can save your credit from going down after the mortgage is in default.

After the mortgage is in default you will have to request the lender for any loss mitigation plan like forbearance or loan modification.

You do not have a job right now but if you think that in a few months you will be able to get a job then mortgage payments can be stopped for a few months or the mortgage modified to add the default amount to the mortgage & mortgage term increased.

When you will contact lender about loss mitigation plan he will ask you to send him a hardship letter. They will then review your financial condition and tell you if any option exists to save the mortgage from going into foreclosure.

Otherwise, deed in lieu of foreclosure, short sale or foreclosure are the only way out. And all will spoil your credit.

How is the equity position of your house? Is refinancing the mortgage is an option open for you? You said that you want to get out of it but that at this moment can hurt your credit score. If any other option can be possible to save the mortgage from going into foreclosure, then implement it. After some time when you are able to find a buyer, sell the house and shift.

Posted: Fri Aug 31, 2007 12:47 am Post subject:

Hi Wildstorm,

Foreclosure bail out loan program is basically a refinance loan. It helps the borrower to repay the existing balance of his loan and thus saves his property from being foreclosed by the lender. But loss mitigation plan consists of various ways with which a borrower can avoid a foreclosure.

wildstorm_films · Joined: 22 Aug 2007 Posts: 130 8.74 Dollars($)

But in order to qualify for this program, there has to be equity available in the home correct?

miller_st · Joined: 17 Jan 2007 Posts: 918 168.95 Dollars($)

Yes Wildstorm, they require that the home should have equity but that hardly happens and if there is equity, borrower would rather look at options such as refinancing present loan is possible.

And such loans have high interest rates and require the borrower to have good credit score.

evolovik26 · Posted: Sat Sep 01, 2007 3:44 pm Post subject:

Hate to be the bearer of bad news Coolchick but if you fall behind on payments or go into foreclosure your credit is forfeit so you'll have to decide whats more important to you credit or your financial wellbeing. Perhaps looking a a bancrupcy might be an option for you.

Posted: Mon Sep 03, 2007 4:16 am Post subject:

Evolovik,

You have mentioned that bankruptcy is an option for Coolchick. But don't you think that bankruptcy will have a far damaging impact on his credit?

wildstorm_films · Joined: 22 Aug 2007 Posts: 130 8.74 Dollars($)

Guest

"If there was some way for me to take out one huge loan to pay off everything that I've listed, that would make things easier and affordable."

It looks like it would be easier but for such a big loan, the interest rate will be very high. And most often the borrower is not in a position to make such large payments every month.

wildstorm_films · Joined: 22 Aug 2007 Posts: 130 8.74 Dollars($)

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Hi Wildstorm,

With the annual income around $30K, one can get a loan from many organizations like Freddie Mae, FHA, MyCommunity and ACORN housing.

The loan program with ACORN housing provides loan with lower interest rate and also lower down payment.

MyCommunity loans are available with 100% financing with lower amount of down payment.

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