Short selling your home is an alternative to foreclosure but, make no mistake, it is looked at and treated almost the same way as a foreclosure.
In other words, avoid all 2 options, Foreclosure and Short Sale at all cost.
Ask to refinance or restructure your mortgage, contact a credit counseling service, speak with a real estate Attorney and or have an honest conversation with a trusted CPA and ask what you can do to avoid Foreclosure or the Short Sale, it really isnâ€™t worth it.
Once again, understand that a Foreclosure or Short Sale isnâ€™t an option, itâ€™s a result and, not a good one at that.
If at all possible, avoid foreclosure at all costs. Credit ratings are becoming more and more important on several levels. Even renting a home is harder with a poorer credit score. Some insurance companies also charge more to low credit people. What I am saying is that even selling for a loss is better than foreclosure. Make sure your realtor is doing everything he or she can, if not, boot them to the curb and get an agent that wll work hard for you.
The best of luck to you!
Michael D Delp
4802 Old Bethlehem Pike,
Telford Pa. 18969
I have a client from Florida who reports street after street of nearly empty condo buildings, and many thousands of people who are pursuing the strategy described below by "Under the Bus." In my opinion that's mortgage fraud: I don't see how they can do it without fudging debt-to-income ratios somehow. (If they have enough income to meet D/I ratios with two mortgages, they can afford to pay the mortgage on the first house and shouldn't be in foreclosure. If they can't, they're misrepresenting their D/I ratio and the bank shouldn't approve the second loan. If the Realtor knows they're doing it, he's failing to disclose facts material to the transaction.)
Anyway, a foreclosure is like breaking a mirror -- your credit is toast for seven years. I've seen people who've had to move in with friends after a foreclosure dropped their credit score so much they couldn't even get approved to rent!
I would do almost anything to avoid foreclosure. I've had people say "I don't care; I won't need credit for the next few years." To which I reply, "How do you know?" You never know what the future may bring. Maybe somebody will lose a job / get sick / get sued / want to send a child to school / who knows, and need a loan really badly. With a foreclosure on your record, you're not going to get it, or you'll get a "credit card" interest rate.
One side point -- as a married couple, you both have an interest in the property. That means *both* of your credit reports will show the foreclosure.
There are lots of options to avoid foreclosure -- there are companies that specialize in short sales (where the buyer pays less than is owed). These are tough for Realtors, since the bank's attitude is "If we're not getting paid, nobody is." They will often specify terms such as "no commissions" or "buyer pays all transfer taxes". These make the deal less attractive to buyers, but it's often possible. The main drawback to this is the time it takes -- months in most cases. There are so many such cases the banks are overwhelmed. If you don't have months, this may not work for you.
You can do a deed-in-lieu of foreclosure -- where you just "turn yourself in" and hand over the deed without making the bank actually foreclose on you. This is less paperwork, but nearly as bad for your credit as an actual foreclosure.
Even if you're leaving town, if the property is in reasonable condition or can be fixed up to be rentable, perhaps you could hire a property managment company to rent it out for you. They'll take a month's rent to find a tenant (typically), and another percentage (2-10, depending on how much work they do) for managing it in your absence.
Bottom line -- foreclosure is very bad; avoid it if you possibly can. For legal advice, consult an attorney; he may know other options related to bankruptcy, etc. (Bankruptcy will also wreck your credit for years, of course.) Good luck! I hope you find a way out of this that leaves your credit intact.
About the realty fee, we have a discounted division of my company so no issue there, and with a short sale banks will negotiate with the Realtor (and is happy to cover that reduced fee).. Let me know if it was just lost in the shuffle of listings or what. Realtybud@aol.com
An option that you might really want to take a look at is:
There is a company my friend works for that specializes in finding buyers and investors for properties who are either being sold as short sales or foreclosures. This might be a way for you to find a buyer faster for your property. If your husband will go into foreclosure then he will not be able to go on a loan from anywhere between 3 to 5 years on any fannie mae loan. I do not want to put my friends info on this website since i'm new to this site so i'd rather give you his contact info directly. You can contact me at email@example.com
You need professional assistance. Are you represented by a Realtor? You should be asking them these questions. There are options but time is your enemy right now. Why did you evict the tenants? Were they not paying rent?
There is too much to cover here, but in brief the amount you owe on the mortgage has absolutely nothing to do the the market price. It sounds as though you as selling without professional representation to save the cost of commission. Big mistake. You need to talk with three Realtor TODAY. They will not charge you. Discuss your situation, learn your options, act quickly!
I work for a bank in the lending department and i do have to tell you that your husband is right because you must try to do naything possible to avoid a foreclosure. There are a few options that you might want to take a look at if you house is not able to be sold such as working with a company that specializes in foreclosure buy outs, short sales, ect....however that all depends on where your husbank stand on the mortgage at a current time. If money is a problem there are ways to get financing to be able to get through this rough real state market we are in where people are having such a hard time selling their homes. However to really be advise you property i'd have to have a much better understanding that you are in.
Feel free to contact me any time.
Mid Atlantic Capital
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Cherry Hill, NJ, 08034
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