Andrea,

I think that everybody gave some great suggestions. I like the idea of checking with Wells-Fargo first and then "possibly" trying to sell it. If you bought the home 4 years ago, that is just about when our home values started to free-fall, and it may be difficult to break even. Walking away will hurt your credit.

Is there any chance that your tennants could buy it? It sounds like their credit might be lacking.

Try Wells first!

Fri May 16 2008, 19:36

Andrea, Some good suggestions.

Alternately, If you need some assistance with your rental property, I suggest checking out your local Real Estate Investors Association (REIA). Or, you can try http://MrLandlord.com

Just in case, here's renting information from the State. www.legislature.mi.gov/documents/publications/tenantlandlord.pdf

I would be very hesitant to just trying to walk away from either home.

Fri May 16 2008, 07:38

First you need to get the renters out and find a good paying tenant. That way you can make your payment. I would suggest this before dealing with a rate change that is not here yet or walking away. Your taxes more than likely went up because the home is non owner occupied now. This is something people do not consider before renting their home. But don't think monthly think Long Term. You can write off the property taxes, you can write off the interest and a tenant will be paying your mortgage down. Think 10 years from now not monthly. The market will turn around again.

Now as suggested calling Wells Fargo will help switch you to a fixed but will not help you make the payment or reduce the extra $200. Also, there may be closing costs involved and you may actually end up with a higher payment. This should not be your concern now it should be making the payment and saving your credit.

As for walking away as long as you understand this will hurt your credit now and in the future. It would be best to get someone in there to help you make that payment. As for a short sale the bank will check many thing before allowing one. Before they take a hit they want to make sure you have eliminated all other options. Have you attemped to sell? Can you afford both payments? Do you have funds in savings? They will ask for a very detailed financial statement. Doing a short sale is always an option but you can not do one unless you have an offer and that requires selling the home. This may be difficult if you have a tenant. Besides a short sale will still effect your credit.

Again, I would suggest getting a new tenant and thinking about your future. Call a local real estate agent and ask them to list the home for lease or lease with option. They can help you with the lease/option, pricing and credit for a small fee.

You are just starting out and you will need your credit. Hope this helps.

Cindy Knight
Realty Executives e-Group

Fri May 16 2008, 07:24

I would talk to your lender about a loan modification. I know a mortgage professional will probably pick up on this question to better assist you with a loan modification. You'd be surpirsed what lenders are will to do to help you keep your home. It can help get you over this rough spot.

But, it sounds like you really would rather sell it than keep. Put it up for sale ... contact 2-3 Realtors and see what they feel is the value of your home. If they don't think they can sell for what you owe, a short sale is another route. Just make sure your Realtors have dealt with them before. Here a good website for helping you determine what you can do in this situation: http://www.hud.gov/foreclosure/index.cfm

Let me know if I can help find you a Realtor in your area.

Best of luck,
Lisa Bender

Fri May 16 2008, 05:48

Before you walk away, call Wells Fargo and have a chat. Tell them your thoughts, they will possibly offer you to refinance out of the Adjustable rate on the rental. Also I would send an certified letter to the renters telling them to pay in full or get out. Walking away should be a last resort.
You can also call another lender to refinance.

Fri May 16 2008, 05:34