I do a lot of short sales everyday and this what I would suggest to you. I could give you a detailed answer to your question but my answer would be based on Washington State Foreclosure Laws. You need to google your state and foreclosure laws. You are looking to find out if your state is a non-recourse or recourse State. I BELIEVE CA. is a non recourse State. What that means is that your home is securred by the collateral only. If it is a recourse state then you can be held personally liable for the debt.
Foreclosure is on credit for 7 years. Short Sale for 2-3. The short sale shows up as "settled". It may be on your credit longer than 2 years but you will be able to purchase again if everything gets better for you which I'm sure it will.
You do not have to be behind in your payments to start a short sale. If your home is listed and it has been on the market longer than 60 days you should be lowering that price to get it sold. Your agent should be able to show the lien holder that you have tried to get a buyer at the highest price possible. The bank does not want your house back!
Please use an experienced agent with short sales. There is no reason your home should not sell by short sale. None.
If you need a referral let me know.
Loan Modification - don't doubt the 150k loan mod. I'm not saying they will and I'm not saying they won't. I am saying many many many many days I am shocked at what the banks WILL DO. so ask.
Good Luck to you and please be persistent. Doing nothing does nothing. I applaud you for getting the information you need to make an educated decision!
My brother has been delinquent with making payments for over two months now. The bank has been calling and sending collection letters to the home. My father never formally transferred ownership of the home to my brother, therefore, his name is still on the deed. I'm sure this has affected my fathers credit. Should the house go into foreclosure, will the bank try to seize my father's
personal assets such as bank accounts and retirement investments?
Looking forward to speaking to you ASAP,
California is non-recourse but only for purchase money. I am guessing from the loan amount that the loan is purchase money, so you might have some options. The agent with whom you have it listed should be able to refer you to professionals that might be able to help you. My suggestion would also be to talk with your tax professional and assess the impact on your tax situation of renting it out.
In a short sale they will ask for a financial statement, so EVERYTHING you have is on the table. Renting might be painful for a few years, but at least you'll have your assets and credit intact.
7301 Pacific Ave.
I am sorry that you have such a hard decision to make. There are many things that can determine what your options are. I would recommend that you contact your accountant to discuss what type of ramifications you may face. Also, I like to recommend a website that can also answer your questions, and help you form a plan to leave your property. They can help you with legal questions and credit questions. They have been featured on National News programs, and I have heard that they have helped many people.
I hope you find this helpful.
Sorry to hear about your situation.
Here is a link that has a lot of info on your states foreclosure processes.
Best of luck