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David Wooadrd, Home Seller in Antelope, CA

Short sale or walk away! House is neg- Eq for 220 thousand, has only been apraised for 205 thousand owe 431

Asked by David Wooadrd, Antelope, CA Fri Feb 20, 2009

on a house that wont ever be worth that again. Dont want to live in house any longer and tried to work with lender to modify loan. They also wernt able to do a refi- so what should i do?

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8
Most people would be much better off doing a short sale than walking away because Fannie Mae is not penalizing those that do by preventing them from getting a conventional loan for 7 years! http://massrealestatenews.com/fannie-mae-strikes-against-str…
0 votes Thank Flag Link Wed Aug 11, 2010
first things first...why are you selling or walking away?

if you've lost employment and are able to show hardship your request for a short will be more warmly welcomed. if you are simply walking away from a crummy investment the lender will be less inclined to play ball.

depending on your facts they may want a personal note as a condition of a compromise.

to get you a proper answer we'll need to know what your long term goal is.
0 votes Thank Flag Link Mon May 4, 2009
David, your options are to let the home go back to the lender either through deed in lieu of foreclosure or through foreclossure.

Your other option is to sell the property through short sale - If you'd like contact me by phone or email and I can explain the process.

Paul
0 votes Thank Flag Link Sun May 3, 2009
Death of owner(mother) left home with 40,000 mortgage with Home Eq. Needs extensive repairs. Apraisel 68,000 w/o repairs. I am only living relative, have no borrower lisabilty. Property hundreds of miles from my residence. I really have no interes unless I get a real deal. Distance and repair costs a real burtden. Payments currently up to date. When should I contact lender? Wait for foreclosure? Now? Walk away?
0 votes Thank Flag Link Sun May 3, 2009
David,

I agree with Sue. Don't walk away from your home. Find out your options. It looks like you've already talked to your lender, and they weren't able to work out anything for you. But soon you may be able to talk to them again or talk to someone else at the bank, and work something out.

If you are sure you have exhausted any way to modify the loan, then I would definitely recommend short sale over foreclosure. You need to talk to someone who is experienced with short sales, and understands what is involved in listing a short sale and getting it approved.

I would recommend you talk to a few agents before making a decision if you do decide to go ahead with a short sale. Make sure you are picking someone who understands what is really involved.

If you have any questions about your options or help in figuring out if a short sale is the best move for you, please feel free to contact me.
0 votes Thank Flag Link Fri Feb 20, 2009
Given your equity situation with the numbers you provide, it appears that you do not qualify for a refi under the new Homeowner Affordability and Stability Plan as detailed below directly from the website referenced.

Also you must qualify for a short sale through an impending hardship such as a divorce, job loss, illness, etc. If you feel you may have a hardship that qualifies try to do the short sale. Make sure you find a REALTOR who has experience with short sales in your area.

• I owe more than my property is worth, do I still qualify to refinance under the Homeowner Affordability and Stability Plan?

Eligible loans will now include those where the new first mortgage (including any refinancing costs) will not exceed 105% of the current market value of the property. For example, if your property is worth $200,000 but you owe $210,000 or less you may qualify. The current value of your property will be determined after you apply to refinance.

Borrowers Who Are at Risk of Foreclosure Are Asking:

• What help is available for borrowers who are at risk of foreclosure either because they are behind on their mortgage or are struggling to make the payments?

The Homeowner Affordability and Stability Plan offers help to borrowers who are already behind on their mortgage payments or who are struggling to keep their loans current. By providing mortgage lenders with financial incentives to modify existing first mortgages, the Treasury hopes to help as many as 3 to 4 million homeowners avoid foreclosure regardless of who owns or services the mortgage.
0 votes Thank Flag Link Fri Feb 20, 2009
DON'T WALK AWAY. You can either do the loan modification or short sale the home, but it is not in the best interest of anyone for you to abandon the home through foreclosure...and now more than any other time in the history of homeownership.

The Stimulus package will have lenders changing policies this month in terms which loans they have the ability to modify. And when one person on the staff says no, there is always the chance, through persistence, that the next time they will approve it. And that does not require any delinquencies in your payments for them to consider a loan modification.

Please call me if you want more details on how you can resolve this, and recover from this financial setback quickly rather than having a foreclosure on your credit report for the next 7 years.

And by the way, I don't know many properties that aren't showing negative equity in this market....the dilemma is affording the payments. Lenders are given leeway to write down principal, and/or adjust interest rates with no tax impact, as far as I understand....still waiting to study the actual 1000+ page bill.

David, there is some solutions out there to discuss further.
Web Reference: http://www.suearcher.com
0 votes Thank Flag Link Fri Feb 20, 2009
You dont want a foreclosure on your credit report.

Short sale your better option have you consider leasing home cover all payments?

You will need a realtor work with short sale property and lender approval.

Sorry to hear all this !
Web Reference: http://www.lynn911.com
0 votes Thank Flag Link Fri Feb 20, 2009
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