I would still call the bank and see if they will work with you. They don't want to take the property back.

Ballentine
I would approach this from a couple of angles:
1. Consult with your CPA on the after tax consequences of any option, including long term rental with a final sale in say, five years, maybe ten years. What did a home in that area cost ten years ago?
2. Talk with the lender about adjusting your loan (loan modification) and explain how it is that at one time you qualified for the loan, and now you cannot afford the payments. it better be a good story.
3. Evaluate the rental market. Talk with a Realtor about options to increase the rental income.

There is no rule that says the market cannot shift and you now have to rent it out for a loss for a long time. This happened to me and 18 years later I sold it for a profit.

I am with Lynn on this one - we don't have enough info to really try to help you. You purchased it as a rental... so...??? is it rented? What does the contractor have to do with anything? Lots of people owe more than their house is worth, that doesn't mean anything except hang on to the house. You obviously thought you could afford it before, what has changed that you can't now? I am not sure what kind of help you need... so I have no idea how to help you.

Is there a reason that you want to sell vs keep it as a rental which if I read your question right was your original intent? You don't mention how long you have owned the property, what you might have rented it for in the past or any of the details which might give us a look at the whole picture. If you can hold on to it then by all means you should do that. As a rental property you are not going to get the benefit from a short sale that primary residences have. The worst case scenario is foreclosure which will keep you in financial hot water for years to come.

The answer to this question depends on more information. But I will try anyway as I sell homes in this area.

Does the rental pay for itself and are your tenants paying on time?
If yes to both then this is sellable in your area of the city.

If the home is not rented then you have choices,
1) Rent it and keep it. Of course that depends where you are in Ballentine.

2) Sell it a loss, which may be offset on your taxes. The devil is indeed in the details here. Keep in mind that appraisels are higher in your area than you can expect to sell for. That means that the difference can be applied to a down payment via some good programs. If you decide to sell make sure you look into financing options for the buyers.
3)Do a true rent to own. That is sell with a future closing date at a set price not just sometime. That is a way to get above market rent and get at least part of this load off your back for Now. Many people who need this type of solution will not be ready to close as agreed which is why you need a realtor who is experienced in this matter, and willing to wait for a paycheck. Junior military in your area can benefit from this and produce a win win for you both, with this solution as they tend to make more in the future and are considered good borrowers.

In any case you need to see a full time realtor and lender for a plan. Anything is possible. The only hopless cases I have seen are those where no action was taken. Good Luck.
Benny Smith, ABR GRI
GSH Real Estate, Norfolk
757-718-9595

Contact your lender and explain the situation. It IS possible under some circumstances to get a short sale through without being behind on payments; however, if you have assets, the bank will expect you to contribute toward the short sale. If you can rent the property, that is probably your best option. If that is not possible, hire a real estate agent who has proven experience dealing with short sales.

A short sale will only work if you are behind in your mortgage payments. Also, while not as bad as a foreclosure - it is VERY damaging to your credit. I would rent it for as much as possible and wait out the market.

Rent it out.
Try a short Sale.
Sell at a loss.