Posted on: 14th Apr, 2009 03:00 pm
I own a small 1/1 condo that is 100k (40%) upside down. My wife is not on the mortgage since we were married after the purchase. My wife lost her job last year, and my income has been dwindling. My wife is also 6 months pregnant. We need to move to a cheaper rental so we can stay above water and have room for baby. Renting is not an option since it would only cover about half the mortgage payment. Our condo has been on the market for 5 months now. We had one low offer that the banks (80/20 loan) rejected, but they came back with an approved amount for a short sale if we can find a buyer. I had to put first/last/deposit on a new rental, so I am now missing mortage payments. How long should I let this go on before trying a deed in lieu. I'd like to avoid foreclosure/bankruptcy. Thanx
There are options available to you, have you heard about the Presidents Home Afforable or DU Refi Plus? The first step is to figure out if you have a Freddie Mac or Fannie Mae loan. Check out the following websites for more information:
http://www.makinghomeaffordable.gov/
Is your loan a Fannie Mae or Freddie Mac? (To determine, call 1-800-7Fannie or 1-800 Freddie 8:00am to 8:00pm EST or visit www.fanniemae.com/homeaffordable or www.freddiemac.com/corporate).
If you have a Freddie Mac loan, here is what your lender will do to help you:
1. Reduce your rate as low as 2%, if that does not put you at a 31% debt to income ratio, then they will
2. Add years to the term of your loan, not to exceed 10 years, and lastly, if they really have to,
3. Reduce your balance of your mortgage (this is something they really do not want to do.
This type of a bail out is being financed by all of the tax payers, but it will stop the short sales and foreclosures, which should slow down the decreasing property values! Atleast that is the plan!
http://www.makinghomeaffordable.gov/
Is your loan a Fannie Mae or Freddie Mac? (To determine, call 1-800-7Fannie or 1-800 Freddie 8:00am to 8:00pm EST or visit www.fanniemae.com/homeaffordable or www.freddiemac.com/corporate).
If you have a Freddie Mac loan, here is what your lender will do to help you:
1. Reduce your rate as low as 2%, if that does not put you at a 31% debt to income ratio, then they will
2. Add years to the term of your loan, not to exceed 10 years, and lastly, if they really have to,
3. Reduce your balance of your mortgage (this is something they really do not want to do.
This type of a bail out is being financed by all of the tax payers, but it will stop the short sales and foreclosures, which should slow down the decreasing property values! Atleast that is the plan!
Since I've put down first/last/deposit on a new rental, I'm not looking for ways to stay in my condo. It's too small as it is for two people, let alone two plus a baby, and I can't afford it anymore. My question was when I should give up on the sale and consider a transfer of deed in leiu of foreclosure.
Then, I would call the mortgage company as soon as possible.