Home Selling in Wisconsin>Question Details

Solitary_99, Home Buyer in Stevens Point, WI

What options do we have for an underwater morgage?

Asked by Solitary_99, Stevens Point, WI Mon Jun 18, 2012

Current house is worth about $100K, we owe $117K. Making all our payments without issue, no forclosure looming. Just need to move 60 miles south due to job locations (the commute is killing us). Are there any options for us to get out of this house without losing $20K? We cannot affort to lose that much and make a downpayment on a new house.

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You will need to show the bank a hardship. Haw the drive is the issue. I would call them and see if you can start a short sale. They will ask for documentation in order to see if you can do a short sale.
2 months bank staatements
2 pay checks
2 year tax returns.
list of expenses
The bank may ask you to help pay for the loss.
It is in there hands and they have guide lines they have to follow.
Debby Thompson
Homestead realty Inc
0 votes Thank Flag Link Mon Jun 18, 2012
$17,000 may seem like a lot of money to you now, but the consequences of a Foreclosure will probably be far worse:

The first thing I would suggest, is to talk to the Loss Mitigation department at your Lender;
They will be a lot more receptive than they were two years ago.
Maybe they can work with you as far as restructuring the loan, lowering the Interest Rate and allowing you to rent it out.
I cannot stress how important this communication could be; to you!

Second option would be a Shortsale; you would have to talk to them about your HARDSHIP and Listing the property. If you have saved $20,000, you may have a hard time proving a hardship; added to the fact that you are not delinquent.
DO NOT give $1500 to some company who promises that they can get your problems solved for you!

An alternative would be to talk to them about a Deed-in-Lieu, whereby you surrender the property to them in exchange for a release from the debt. (You will want a letter stating that they will not pursue a Deficiency Judgement against you.)

Good luck and may God bless
0 votes Thank Flag Link Mon Jun 18, 2012
Explain your situation to your lender and ask if they will forgive some of the mortgage. THEY KNOW that you have the option to walk away from it. Be firm. If you don't have any luck with that, consider renting your home. It's likely that you'll actually make more than enough to pay the mortgage, but being a long distance landlord can be a headache. Heck, being ANY landlord can be a headache.
You might consider refinancing BEFORE you start any of this, tho, if you can reduce your payments.
0 votes Thank Flag Link Mon Jun 18, 2012
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