Join your HOA. It is amazing how much power an HOA has. Under proper leadership, your HOA can make a big difference.
192K down to 129K in the last 12 months. 31%? That is a very hard hit. Are you sure?
1200 Sq ft house. thats pretty small.
You have got to be close to bottom.
IF you want to get out, how much is your monthly payment?
How much can you rent it for?
How old is the home?
Don`t just walk away!
In general, housing price is very hard to drop 20% due to the fact, the mortgage banker is the boss. e.g. if you pay $192k with 20% down, that 80% mortgage would be hard wall, if you willing to sell and left go your 20% down, bank will NOT.
If there is ever such opportunity, you should buy your neighbors' condo and rent them out, but I doubt.
KNessler: if you decide to proceed w/ a foreclosure, this is what will happen with your credit score:
- first 30 day late, drop by 20-30,
- first 60 day late, addtl drop by 60-75 pts,
- first 90 day late, addtl drop by 75-100 pts,
- foreclosure, addtl drop by 100-150.
Your score will be in the 400 range at the end. If you and your spouse are both on the mortgage, both your scores will be in that range. All of the above will stay on your credit for 7 years, but the first 2 years will be brutal.
Somebody should advise you on the recourse laws in your state, before you decide to go into foreclosure. Depending on state laws and your personal circumstances (purchase money loan, refi loan, first mtg only, first and second), there might be some implications on your financial situation.
Who was your realtor when you bought the place? Sounds like he/she miscalculated on 3 criteria when helping to choose your house:
If you have to move consider renting or in the worst case do a short sale if you really have to. Forclosure should be a last resort.
As far as your neighborhood goes, that's very unfortunate it seems like you've tried to do many things that usually fix the problem - last step could be to join the association.
You have a great credit score and have worked hard to get it where it's at. I wouldn't throw it away.
There is good news, a plan that may make it so you can refinance your home and only pay on what it's currently valued at. If you sell your home in the future, you'll need to pay the bank back but in the meantime they will "forgive" some of you current mortgage. We wrote about it in our blog - source below
That is not the Market Value of your home.
If you email me your address, I would be glad to do a Comparative analysis of the neighborhood.
Warning, it might not be much better.
As for the HOA, they work for you, get on the board. Triple the fines.
Money is a great motivator
Second, Patrick had very specific and good advise. He did not say "complain" to your HOA - he suggested you join it. In a leadership position on an HOA you can make a difference in the community you live in. It would mean sacrificing a little time, but compare the 6 to 18 months it would take to turn your neighborhood around compared to 5 to 7 years of living under that cloud of foreclosure. Walking away is easy, it is usually true, however, that the easy thing is not the right thing to do. Best wishes no matter what you decide, Stacey