Home Selling in Las Vegas>Question Details

Strummingmyg…, Home Seller in Las Vegas, Las Vegas,...

upside down by 100K. What options are available?

Asked by Strummingmyguitar@gmail.com, Las Vegas, Las Vegas, NV Sun Jun 5, 2011

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Michael Yarbrough’s answer
There are several options available for a person in your situation. First you will want to consult with an Attorney, and a CPA. Interview several to determine which may be able to provide you with the best options for you. After you interview them you may decide that a Reator is a good option, you will want to interview several of them as well to determine which will work for you to resolve your delima. I know several Attorney's and CPA's who would be happy to help and give you advice.

After you speak with them interview Realtors and after you have interviewed a few of them give me a call and we can schedule to meet and review your real estate options. And after you interview me you can decide which Agent is better suited to assist you.

Mike Yarbrough
Simply Vegas
3042 S. Durango Dr.
Las Vegas, NV 89117
Direct: 702-985-5566
Office: 702-685-3000
E-mail: yarbroughm1@coxl.net
1 vote Thank Flag Link Sun Jun 5, 2011
A lot of options such as short sales, foreclosures, and bankruptcy have very negative consequences. You may want to see if you can rent your home out to cover some or all of e cost of the mortgage. Hopefully between paying down the mortgage and the markt coming back a little, you may be able to sell in the next few years.
1 vote Thank Flag Link Sun Jun 5, 2011
There are a few options for your underwater property. I will go over each option in depth below:

1. Short sale your property, which in my opinion is the BEST OPTION unless you have a lot of other debts such as credit card or medical bills. Usually the credit hit is worse when you are delinquent on your mortgage. It is generally a misnomer that you cannot short sale your property without being delinquent on your mortgage, this is incorrect. You can short sale your investment property while being current on your mortgage, but not every mortgage company is cooperative. Sometimes it depends on the mortgage company and sometimes the mortgage companies need a little nudge. But if you are not delinquent it does not hurt your credit as bad.

I recently completed a Bank of America short sale and the person was not delinquent. I got her into another lower mortgage when her house was short sold. She originally bought her home for $500K short sold it for $227K and bought a new house for $306K. About a month after her short sale, she pulled her credit and she still had a 755 credit score, the first and second mortgage loan with Bank of America was marked “PAID” on her credit report and she now has a new house that she can build equity in. Please see her example short sale approval letter here http://vangrouprealestate.com/short-sale-approval-letters/. In addition, she will be happy to talk to you to give me a recommendation if you are considering short selling with us.

In a short sale your property is listed with us for the current fair market value even though there may be more owed on the property. The lender may accept what is owed on the property as pay-off of the loan obligation. The bank may request a promissory note or request a lump sum at closing to waive the right to a future deficiency. In our experience, most banks are waiving the deficiencies in the short sale approval letters with either no money or a small settlement amount. In addition, it is easier to get a loan in the future, so less wait time to buy a home with financing.

2. You could file bankruptcy and let the house go in bankruptcy or modify the mortgage in bankruptcy. Sometimes a short sale is not the best option if the Seller is in a lot of debt other than real estate debt. Please consult our law firm Kung and Brown and ask for Sandy Van. http://(www.ajkunglaw.com).
The bankruptcy route should be your last resort, because Bankruptcy is like your wild card that you want to keep and use only in extreme circumstances since you can only do it once every 8 years unless you do a Chapter 13.

3. Let the property go into foreclosure. This if probably your WORST option. Although we are in unchartered waters, and there are no cases on point regarding foreclosures because homes have generally risen in value, under foreclosure laws, the mortgage company may come after you for the deficiency balance (difference in what you owe plus legal fees and the amount on the date of foreclosure or fair market value on date of foreclosure link to NV law . Please see my site for the link to NV foreclosure laws.

When I mean deficiency, once the bank goes thorough the legal process, they may get the court ordered deficiency judgment and go after bank accounts, wages, and lien any other property you may have. The bank may decide to sue you, settle with you, sell the debt to a debt collector to harass and hopefully settle with you, or the bank may decide to sue you for the deficiency. In addition, they may come after your spouse, since NV is a community property state. If you are unmarried, you may want to consider getting married after you work out your financial issues.

In addition, the Credit reports also disclose the damaging information. Loan applications generally ask if the applicant has ever been foreclosed upon. In addition, it will be a longer period of time before you can obtain a loan for a home purchase in the future.

4. Do a loan modification. Basically refinance the debt or extend or modify the terms of the loan. Try and do this on your own, because most companies do not do anything more than what you can do on your own. In some cases, some of these companies take your money and do nothing on your mortgage file.

It is also very, very rare (less than 2%) to get a principal reduction. Most loan modifications offer you a lower interest rate for a period of time, thereby lowering your payments. You will have to weigh the pros and cons of this decision, because it could be prolonging the inevitable. Homes appreciate on average 2-4% so you may want to run the numbers to see how long it will take you to break even and begin building equity. Studies have shown that it may take 20-30 years to break even.

If you like this answer, please give me a thumbs up!

Sandy Van
The Van Group at Realty Executives of Nevada
Attorney, Realtor, Broker-Salesman
1 vote Thank Flag Link Sun Jun 5, 2011
A loan modification could potentially lower your payments, but it's unlikely to reduce your principal. If you want to sell your home, then a short sale is something to consider. The goal of the short sale is to negotiate with your lender to allow the sale of the home and to accept current market value to settle your debt. A real estate agent with extensive short sale experience (myself included) can discuss and assess your situation and help with your short sale with out charge because their commission is paid when your home sells. You can also discuss your options with an attorney.

Damon Botticelli
Realty One Group
(702) 523-7713
1 vote Thank Flag Link Sun Jun 5, 2011
Hi Strummingmyguitar,
Have you talked to your lender about your options? I would think you should start there. There are options available to you. Call or shoot me a email if you would like to discuss your options.
John J. Longeway
Keller Williams Realty Southern Nevada
office: 702-777-0002
cell: 702-325-4833
email: jjlongeway-homes@kw.com
Web Reference: http://www.JJLVRealtor.com
1 vote Thank Flag Link Sun Jun 5, 2011
Do you need to sell at this point? Have your earnings changed? The market will return and home values will go back up eventually so if you can wait it out, do so. Also, what is the value of the home? Are you 100k upside down on 200k or are you 100k upside down on a million? It makes a huge difference.
0 votes Thank Flag Link Mon Jan 30, 2012
None, if that's really your down number. You wait it out. Unless you're 100 yrs. old.
0 votes Thank Flag Link Thu Jan 26, 2012
There is alot of useful information on this thread. But, understand each family's situation and motiviation is different. Please call me to discuss your situation privately. I can get you in touch with the right attorney and accountant for property legal and tax advice. If you decide to sell the property, you need an experienced Realtor that specializes in short sales. You wouldn't see a foot specialist if you were suffering chronic headaches - even though they are both physicians, each has their speciality. Real Estate professionals can be much the same. When interviewing agents ask: How many short sales have you closed in the last 90 days? Have you worked with my lender previously? What is your follow up plan to keep my file on the top of my negotiator's pile?

Nichole LaVigne
Prudential Americana Group Realtors
0 votes Thank Flag Link Mon Jun 6, 2011
Hello 100k upside down,

You have many options. First of all how do you know that the property is 100k upside down? Secondly, why are you wondering what your options are? Do you need to move? I have lots of questions for you.

Penny O'Brien
Simply Vegas
3042 S. Durango
Las Vegas,NV 89117
0 votes Thank Flag Link Mon Jun 6, 2011
The obvious option would be to overlook the lose and wait for the property to return to value, then nothing gained but even better nothing lost. If you can't sit comfortable with this then sell!
0 votes Thank Flag Link Mon Jun 6, 2011
9 options available. The right one depends on what you want to do with the property (stay or go). What your future goals/expectations are. And what is your time frame.
You can visit my website for details and FAQ's or call me.
Chris Dowlen
Keller Williams Realty
Web Reference: http://www.teamdowlen.com
0 votes Thank Flag Link Mon Jun 6, 2011
You are not alone having an upside down house in Las Vegas. I believe the latest stastic said Las Vegas is #1 in underwater mortgages, that 75% of the houses with mortgages are underwater. It you can prove hardship, you have options, if you can't prove hardship, you have little recourse.

DAVID COOPER Foreclosure and Bank REO's Investor-Las Vegas.35 years experience For freee list
Call +1-7024997037 or check website
0 votes Thank Flag Link Sun Jun 5, 2011
Good day possible Home Seller,
Helene's answer says it all in one place. The answers are all there. Now you only need the proper questions.

Remember that when you decide to not pay back any loan, there are penalties. You need to be aware of all of them and decide what is acceptable to you now and in the future. Some penalties are harsh, some you will be willing to live with.

You have lots of options including continue paying the loan, bankruptcy, short sale, and foreclosure. The BK can be before, or after, the others. Timing is very important in the sequence to remove future financial liabilities for the loans.

You need to consult with an attorney that knows BK and real estate processes and an agent familiar with the BK issues as well as court processes and a CPA for tax law working to keep your tax liabilities low. Some BK attorneys do not place the property in the BK and you wind up with no credit and the mortgage debt after the BK is discharged. I have clients that happened to . Now they have a BK, foreclosure, and payment of the loans to look forward to. I am now working to get them cleared of all the debts.

The penalties are a moving target. Penalties change as the wind. By waiting, you may open up more options (good and bad for you) and others may go away.

You need to build a team of professionals that will work together and assist you in your future plans. There is no "one answer or process" to fit everyone.

Call me to help build a team to meet your future financial needs.

Please contact me immediately if you know a person that cannot make their mortgage payments. I will work with them to avoid foreclosure or bankruptcy at no charge or fees to them.

Steven Goldman, CRS
Broker Salesman
Certified Short Sale Professional (CSP)
REO-BPO Certified
Realty One Group
Las Vegas, NV 89135
Direct 702-242-1372
E-Mail: crssteven@teamgoldman.info
Web Site: http://www.teamgoldman.info
0 votes Thank Flag Link Sun Jun 5, 2011
Helene's answer is excellant. Your $100,000 upside down loan in Las Vegas is what the vast majority of homeowners in Las Vegas are facing. If you can't prove hardship, you will have to decide to destroy your credit by not paying your mortgage and face foreclosure, or not paying your mortgage and trying to show hardship to get a short sale agreement from the bank.

DAVID COOPER. Foreclosure and Bank REO Investor-Las Vegas. 35 years experience. Get a Freee List
Call +1-7024997037 or check website
0 votes Thank Flag Link Sun Jun 5, 2011
You definitely need to consult with an attorney before you choose any option so you see any consequences you may have no matter what you decide to do.

I would be happy to recommend one of the best attorneys here in Las Vegas that would gladly provide you with your options. After being informed, you can decide which is the best option for you.
0 votes Thank Flag Link Sun Jun 5, 2011
If you want to sell, you could do a short sale. I would be happy to explain the process to you.

Eli Givoni, Director
Short Sale Department, LLC
Serving all 50 states

MARS Disclosure for General Commercial Communications
Short Sale Department, LLC is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan. If you stop paying your mortgage, you could lose your home and damage your credit.
0 votes Thank Flag Link Sun Jun 5, 2011
In order to best protect yourself consider consulting with an attorney; is a short sale an option....
0 votes Thank Flag Link Sun Jun 5, 2011
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