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Hoping someone could help? My new wife (i'm not on the mortgage) currently owes $95,000 in a 80/20 loan ($80,000 on the first and $15,000 on second). We want out of the house because the neighborhood is getting dangerous and most homes are now selling for $20,000. My wife can afford the house on her salary but doesn't want it. She's also pregnant! I own another home and have great credit and a great job. Can we get out of this house without her quitting her job? I'm thinking about trying a short sell first and file forclosere as the second option. What are your thoughts.

jameshogg · Posted: Mon Jan 05, 2009 10:26 pm Post subject:

Hi black boo,

If you are delinquent on your mortgage payments, then you can apply to the lender for a short sale. A short sale affects your credit by 75-100 points as compared to a foreclosure wherein your credit will be lowered by 250 points. In short sale, the lender will sell off the property and recover his debts. The deficient amount resulting from the sale of the property will have to be paid by you. I think a short sale will be a better option for you. You can also check out the other ways avoid foreclosure from the given link:
http://www.mortgagefit.com/foreclosure/17ways-avoid.html

Thanks

bob1 · Posted: Tue Jan 06, 2009 7:16 am Post subject:

If you are in a financial position to afford the home, why not rent it out ? Even if you have to subsidize the payments somewhat, you achieve the objective of leaving the neighborhood. That way, your wife's credit won't be destroyed for several years from the bankruptcy or foreclosure, if you decide to stop paying for the mortgage.

In a situation like this, since you are not on the loan, only her credit will be impacted, so that is also a consideration in how you decide to proceed.

My advice is to always protect your credit, it takes a long time to recover from a major event like this. You'll pay more for any credit than can be obtained over the next several years, and creditors will raise the rates on current credit cards if the default occurs and the property goes to foreclosure.

All we can offer here are non specific suggestions, every situation is different. You would be best served in talking to an attorney who is familiar with both bankruptcy and real estate before you make a decision.

almam95 · Joined: 06 Jan 2009 Posts: 2 1.75 Dollars($)

Don't get a crooked lawyer...lousy loan mods..fight and turn the tables on your mortgage bank/company! Don't let them win. You can win!

[Promotional text deleted as per forum rules. Thanks.]

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short sell or forclosure?