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evren_ugu · Joined: 18 Apr 2009 Posts: 4 3.68 Dollars($)

my wife had a house for two years as her primary residence. and she had to move out of the state and relocated and she does not continue paying .she can not refi .. can not find someone to rent who can pay decent.. the house is in michigan troy.. what does she need to do??
there are alot of hot air out there no definitive directtion.. please help

savior70 · Posted: Wed Apr 22, 2009 6:43 am Post subject:

Hi

If the bank forecloses on the property, they may come after your wife for the deficient amount. If she has decided she won't make payments towards the mortgage, she can talk with the loss mitigation dept and discuss the option of a deed in lieu. Generally in DIL, the lender forgives the deficient amount. This, however, will affect your credit score almost as much as a regular foreclosure.

evren_ugu · Joined: 18 Apr 2009 Posts: 4 3.68 Dollars($)

and the consequences..
as far as I have gathered from all the commotion out there ... there is really nothing set in stone in this business.. it is always.. they may they may not.. it is frustrating .. I wish I can meet someone who can tell me for sure what is going to happen.. here is the snapshot of my wife situation..
she bought the house 2.5 years ago with 80/20 loan.. 260K first the first lien with %7 and 60K is the second lender with %11 .. the total loan amount is 330K. It was her primary residence when she purchased it but she recently moved to another state, arkansas, for work. so it no longer is her primary residence but she has not purhcased another home yet..
Her credit is close to 800..
The current appraisal came at 230K. she is already 100K underwater in just 2.5 years. and this house is in the best possible location in metro detroit.. ( the city is literally in shatters.. beyond recognition).
She is willing to keep the house if she can refi it. however she can not because of the curent value of the house.. and that brings her loss mitigation world...at this point, the size of the damage to her credit is not our issue..all we are trying to make sure, whatever the direction we will endup talking we do not wanna be liable for anything.. at the end of the day..
1- Will she be approved for short sale because there is really no hardship to speak of besides the fact that she relocated.. should he go ahead and purchase a house in arkansas before she goes for short sale?? will that improve her chances . In case short sale is approved, will the deficieny be waived and a 1099 will be issued and she will have to pay taxes on it..??
2- if DIL or foreclosure.. will the lender come after her?? will the bank has a way of finding out how much money i am making and garnish my wages and whatnot.. i really need a definitive answer.. no "may or may not" deals please

adonis · Posted: Sun Apr 26, 2009 11:41 pm Post subject:

Welcome back evren_ugu,

She should apply for a short sale with the lender. It is lender's discretion whether he would accept the short sale request or not. I don't think purchasing a home in Arkansas will help her cause. In case of a short sale, the lenders demand the deficient amount resulting from the sale of the property. If the lender forgives the deficient amount, then she will have to pay taxes on that amount.

If she goes for a DIL, then the deficient amount resulting from the sale of the property will be forgiven. But she will liable for paying the taxes for that deficient amount as it will be considered her income.

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will bank come afer my wife if forecloses