Home Selling in Jacksonville>Question Details

aelkins8621, Home Seller in 32226

We are upside down on our mortgage. We are getting divorced and need to get out sooner rather than later. What are our options at this point?

Asked by aelkins8621, 32226 Thu Dec 6, 2012

My husband and I purchased a house about 5 years ago on the Northeast side of Jacksonville. We took out two mortgages at the time. One for $160K and one for $60K for a grand total of $220K. The house is now valued at about $120K. We have decided to get divorced and we are trying to figure out the best way to handle the house. Neither of us can afford the house alone and we have reached a point where we cannot stay there together any longer. Houses this size and condition in our area are going for around $300 less per month than our total mortgage cost. Would we be better off to just rent our house out and lose $300 a month, short sale it, or explore other options? We both have pretty good credit right now (his is in the excellent range and mine is in the very good range) and I would hate for either of us to ruin our credit but I would be willing to consider anything at this point. Any advice would be greatly appreciated.

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Gloria Young’s answer
It is very simple to resolve the problem. Contact your lender and request a short sale package. Put the house on the market as the short sale package is getting approved by the lender. However, it depends on the type of loans that you have on the home. You may need two to five years before purchasing another home.
You contact me at (904) 739-9000 to assist you in re-establishing your credit.
0 votes Thank Flag Link Thu Dec 6, 2012
Based on the situation you described it does appear that a short sale would be your best option for disposing of the home. However be aware that your credit will take a pretty good hit. Exactly how much is difficult to estimate. If preserving your good credit is worth $300 ($150 each) per month to you then renting may also be a good option. Renting the home long enough to allow each of you to get into another home before tanking your credit might be somethng to consider. Just be aware that when you turn the home into a rental (investment) property you will lose the homestead exemption which will result in a significant increase in property taxes. You may be able to offset a portion of the added taxes by claiming property depreciation on your tax return. Consult a CPA or tax attorney for the tax implications.
1 vote Thank Flag Link Thu Dec 6, 2012
Good Afternoon Aelkins8621,

You are not alone in this situation, however, you do have options. Good credit is very important and it sounds as though you want to make the wisest decision. I have several questions I need answered before going into options and solutions. Please call me at 904-894-8980 or email me at wandamcreynolds@gmail.com so that I may discuss these options with you. I am a Certified Distressed Property Expert and can assist you through this process.

Thank you for sharing this information and I look forward to hearing from you soon.

Wanda
1 vote Thank Flag Link Thu Dec 6, 2012
I'm sorry to hear about your divorce. I hope it's not a result of financial matters. I think it sounds like you need to list the home for sale with a REALTOR and get an offer in as soon as possible. That will start the short sale process for you with your bank. Yours will be tough because you have two lenders who need to sign off on it but its not impossible.
0 votes Thank Flag Link Fri Jan 23, 2015
You may want to check into something called a HARP refinance loan. It will not lower what you owe on the property but can/will lower your interest rate. At closing both of you would need to be there and 1 of you would need to sign the house over to the other person who will qualify (income) to loan. It is a "Low Doc" loan so whoever does the loan for you should only require minimal paperwork. ...its something to look into, Good luck
0 votes Thank Flag Link Fri Jul 19, 2013
If you short sale the house you won't be able to buy again for 3 years. Also your credit will probably take a 80-150 point hit will the tansaction is complete. Renting might be a good Idea,
0 votes Thank Flag Link Tue Dec 11, 2012
I work primrily with homes that are in a short sale situaton. You received some good answers here from the other realtors, however, a good tax accountant and real estate attorney are essential.
Chose an attorney that does not charge you up front but will take his commission when the property closes. Just as the realtors have a stake in the satisfactory outcome so does your attorney.
I have two certifiation in shorts and foreclosres and have been doing short sales for over 5 years.
Please give me a call if you would like my help.
Pamela Pearce
Pruential Network Realty
904-534-8600
0 votes Thank Flag Link Mon Dec 10, 2012
First of all I am very sorry that your in this situation. A divorce and a short sale are both very stressful and I can only imagine the stress. I just recently finished a short sale with similar situations and there were a few things that you can/can't do that might affect the short sale and if you qualify the debt forgiveness. I highly recommend you call myself or another agent familiar with this situation. You really need to try and get it listed as soon as possible before the end of year to make sure you can take advantage of any tax credits etc., on the sale of home before they expire. Truly wish you the best of luck and call/text me I would be glad to help.

Dawn Niermann
Realtor
Prudential Network Realty
904-662-1357 cell/text
dawn@propertyjax.com
0 votes Thank Flag Link Thu Dec 6, 2012
Sry to hear about your situation. If you would, give me a call at 904-349-0082 so we can go over your options. I look forward to speaking with you. John Breen
0 votes Thank Flag Link Thu Dec 6, 2012
Hi

I have handle a lot of short sales that are similar to your situation. I have had them close in about 3 months with two liens on them. I am close two this month. I would love to help you out.

I handle my own short sales and have been successful with everyone except the one I gave to an attorney who let the house foreclose with an active contract on it. Since then I handle all my own work. I have been doing short sales for 5 years.

Please call me with any questions.

Claire Meadows

904 386 4358
0 votes Thank Flag Link Thu Dec 6, 2012
You do not have to miss your mortgage payments to do a short sale. When you short sale the bank also pays all commissions and seller closing costs. Every bank is different and each homeowner's situation is different. we have handled short sales for owners who had over $200K in the bank. this is not uncommon. It comes down to your decision for you and your family. you will both be faced with paying for two residences potentially. How would that affect you both? How long could you do it, and what if life showed up and one person had to make the full payment. It's more about where will you be in the future if you keep it or if you get rid of it. WE have worked with major banks, credit unions, and HELOC's. They all work differently. Hopefully I could offer some insight to the details of a short sale so you can better explore all of your options.

CC Underwood
The Sellin' With CC Team
http://www.ShortSalesinJacksonville.com
904-401-8481
0 votes Thank Flag Link Thu Dec 6, 2012
The Obama Administration has implemented a number of programs to assist homeowners who are at risk of foreclosure and otherwise struggling with their monthly mortgage payments. The majority of these programs are administered through the U.S. Treasury Department and HUD.

Here are a few of the programs available to home owners who are at risk of foreclosure. Contact your lender to see if you are eligible:

The Making Home Affordable © (MHA) Program is a critical part of the Obama Administration's broad strategy to help homeowners avoid foreclosure.

Home Affordable Modification Program (HAMP): HAMP lowers your monthly mortgage payment to 31 percent of your verified monthly gross (pre-tax) income.

Principal Reduction Alternative (PRA): PRA was designed to help homeowners whose homes are worth significantly less than they owe by encouraging servicers and investors to reduce the amount you owe on your home.

Home Affordable Refinance Program (HARP): If you are current on your mortgage and have been unable to obtain a traditional refinance because the value of your home has declined, you may be eligible to refinance through HARP.
There are also programs for underwater mortgages, unemployed home owners and for those looking to transition to more affordable housing. Here is a link to learn more:
http://portal.hud.gov/hudportal/HUD?src=/topics/avoiding_for…

Simon Campbell - http://www.bankforeclosuressale.com/
0 votes Thank Flag Link Thu Dec 6, 2012
Please call me as I have handled/closed six shortsales in the 32218/32226 north side area in the last 6 months. It is NOT the option forever everyone but it is an option.
Thanks
Tim Tutt
Jac Elite Realty
904566-9157
0 votes Thank Flag Link Thu Dec 6, 2012
Hi

I have handle a lot of short sales that are similar to your situation. I have had them close in about 3 months with two liens on them. I am close two this month. I would love to help you out.

I handle my own short sales and have been successful with everyone except the one I gave to an attorney who let the house foreclose with an active contract on it. Since then I handle all my own work. I have been doing short sales for 5 years.

Please call me with any questions.

Claire Meadows

904 386 4358
0 votes Thank Flag Link Thu Dec 6, 2012
Aelkins8621

1. Are you behind on your mortgage payment?
2. Can you afford the mortgage payment knowing you may not be able to rent it for what the payment is?
3.If you answered yes to those questions, how long can you keep doing that and who is going to make the payments? Are you going to split them, who's going to send them in?

What type of loans do you have are they with the same lender?

The best thing is for you to sit down with a real estate agent experienced in short sales, that can help you figure out what is best for you. They usually can recommend an attorney or other professional who can help if necessary.

I'd love to help you.

Sharon Molnar
904-382-6792
sharonmolnar@att.net
0 votes Thank Flag Link Thu Dec 6, 2012
Hi,

All the answers are good. Best to contact your lenders and get them on board too.


Blaine Rabe
Deltona Realty
904-874-0814
0 votes Thank Flag Link Thu Dec 6, 2012
Two things. Find a real estate agent who has worked with short sales, and find a real estate lawyer who will negotiate with the bank for you. I am sorry to hear both of the financial implications and of the impending divorce, but do find good and knowledgeable people to help with the stress.
0 votes Thank Flag Link Thu Dec 6, 2012
And this case it does sound like a short sale would be the best option but you could consult a realtor and or an attorney ASAP
0 votes Thank Flag Link Thu Dec 6, 2012
We advise speaking with a good real estate attorney and accountant to learn your options. We work closely with one who will provide a free consultation. If you choose to sell as a short sale, it is important that you work with an agent and attorney who have a lot of experience.

Again, because of the legal and financial implications it is important to get answers from a real estate attorney and accountant before making a decision.
0 votes Thank Flag Link Thu Dec 6, 2012
To clarify, when I said houses in our area are going for $300 less per month, I was refering to houses being rented.
0 votes Thank Flag Link Thu Dec 6, 2012
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