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2nd home going into foreclosure

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sheralaska Joined: 16 Mar 2011 Posts: 1 1.38 Dollars($)	Posted: Wed Mar 16, 2011 11:35 pm    Post subject: 2nd home going into foreclosure Like 0 Dislike 0 Basically, I co-signed my brother's mortgage. It is an 80/20 ARM at fairly high interest rates due to his poor credit. He was to refinance within 2 years after establishing better credit. Instead, he lost his job and I have been paying most of the mortgage payments for the last 4+years. I have my own mortgage and paying his is getting very taxing. the home has reverse equity. I have always had excellent credit but paying a mortgage on a house you cant touch...? I am considering to stop making payments. the 1st & 2nd are both the same lender. What is the best way to get out from under this home?
adonis Joined: 22 Oct 2005 Posts: 10562 Location: ALASKA 1089.18 Dollars($)	Posted: Thu Mar 17, 2011 2:01 am    Post subject: Like 0 Dislike 0 Welcome sheralaska, If you stop paying off the mortgage, the lender will foreclose the property which will have a negative impact on your credit report. Your score will get reduced by 250 points. Unless your brother refinances the loan or assumes it, you won't be able to get rid of it. However, as he does not have a job, then he won't be able to refinance the loan. _________________ Procrastination is the enemy of your financial success
sheralaksa Guest	Posted: Thu Mar 17, 2011 12:13 pm    Post subject: so what do I do? Like 0 Dislike 0 So, what is the best way to get out of this? If it goes into foreclosure I may still have to pay the balance above what it sells for right? so, is the best thing to do to sell it and then I would still have to pay negative equity, right? What would you do?
smithsussane Joined: 18 Sep 2008 Posts: 10439 Location: Alaska 985.83 Dollars($)	Posted: Thu Mar 17, 2011 11:48 pm    Post subject: Like 0 Dislike 0 Hi sheralaksa! Welcome to forums! It is true that if the property goes into foreclosure, then you'll be liable for paying off the deficient balance resulting from the sale of the property. If you're facing hardship in paying off the loan, then you should contact your lender and apply for a deed in lieu of foreclosure. If the lender accepts it, you won't be liable for paying off the deficient balance resulting from the property sale. Feel free to ask if you've further queries. Sussane

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