Should I allow my home to foreclose?
I live in Las Vegas and purchased a home at the worst possible time. I was single and the mortgage is in my own name. When I got married my husband and I purchased another home together and found a renter for my old house with plans to sell as soon as the market turned around. Well, the market has tanked. I bought it for 275k (100% financing – dumb) and it is now worth 150k. Rent is cheap now and I can’t get anyone to pay more than 1000/mos and my payment is 2200. The lender will not give me a loan mod (already tried) and I can’t refi since I have negative equity. So, after my share of the payment , the HOA fees and maintenance I’m paying 17k a year on a house that I can’t short sale, I can’t sell, I can’t do anything…. My husband thinks I should allow it to foreclose because it is such a huge financial burden. Will it effect his credit (I bought when single)? I know I would need at least 2 years to get my credit back on track, but I don’t want any other surprises. Can they take any other assets? I’ve read that some financial analysts recommend that you walk away when you’ve lost more than 20%, which most would find counter-intuitive. I don’t think I’ll be able to turn this thing around as is and the pressure on our finances is more than either of us can handle….
sounds like you need another job. well you know your credit takes 7 years to get back on track.
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LikeDislikeIf you bought the house before you got married and your husband isn’t on the mortgage paperwork…. then his credit should be safe.
But since I don’t want you to make major financial decisions on my advise I would suggest that you have a talk with your tax consultant.
It shouldn’t cost you an arm and a leg but it is better to have your ducks in a row before you end up ruining your husbands credit.
As to the house that you want to foreclose on
Make sure that you don’t “own” any other assets that could be liquidated to pay for the shortfall when the bank forecloses on your property and sells it for less than what you owe on it.
Yes, they could come after you for their “shortfall” and if your name
is on the house that you and your husband acquired together then that means that you have assets that they could put liens on.
This is why you need to get some real good financial advise before you turn the keys in to the bank and tell them to take back the house that you can’t afford anymore.
There are ways to prevent that… but only a real good expert can get you prepared and keep your other assets save.
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LikeDislikeTalk to a tax dude and find out the ramifications. Also, check out what the government is offering. There might be something in the 700 billion bail out for you…doubtful, but you never know. Good Luck.
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