Condo depricated -- in need of serious advice -- sell, refinance or foreclose?

Asked by Mariah, Jacksonville, FL Mon Feb 4, 2008

My condo has depreciated approximately 35,000 since I purchased it 2 years ago. I cannot afford the payments on my own. I bring home less then what my mortgage payment is monthly. I've contacted the lender and they told me I must default on my payment before they can do anything further (i.e. short sale, deed en leiu)...I did 100% fiancing and looked into refiancing, but would still need to put down $35,000 since it will appraise for that now. I need advice on where to go from here -- if I sell, I still need to find a buyer as well as bring $$ to the table, if I refinance, I still have to find the difference amount and there's no guarantee the market will change. What do to from here?

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Hp, , Texas
Mon Apr 7, 2008
Hey I may be relocating to Jacksonville very soon and thought about trying to find a "room to rent"...maybe I can help you out for short while (or anyone else in this situation)? I just want an inexpensive way to live for a few months in order to learn more about the area. Then I will be buying and moving my family. (I am a female professional, age 50, nonsmoker, quiet and keep to myself).
1 vote
Alex Inskeep, , Scottsdale, AZ
Sat Apr 5, 2008

What happened that you can't afford your payments now? This will be important to the bank.
1 vote
Brittany Ste…, Agent, Mckinney, TX
Wed Feb 6, 2008
I'm sorry to hear of your misfortune. Unfortunately, there are many home owners that are faced with the same situation you are. I would definitely sugguest that you discuss a shot sale with your lender.
1 vote
jcs2000, , South Dakota
Thu Apr 10, 2008
This is a difficult situation. If however, your take home pay is less than your monthly mortgage payment, you really cannot afford the property. It sounds like you may have had an option 2 year ARM or something similar and are now facing a high reset payment. The market is weak and after paying a 6% commission for realtor services, you will need to bring $$ to the table to sell which you likely do not have. Therefore, you either a) foreclose or b) attempt to have the bank modify the terms of your loan. Start with (b) and if the bank says you must miss a payment then do so. The realty is that you cannot really afford the property and there is little point in burning through whatever savings you have to keep your head above water. Don't feel like your situation is unique--it is the same circumstances for millions of home owners across the country currently.
0 votes
Cora Hunt, Agent, Jacksonville, FL
Sat Apr 5, 2008
The condo market is trying to improve, but many lenders are now requiring a Buyer to put 10% because we are deemed to be in a declining market. This makes the desirability difficult because the townhomes being sold are not in the same situation and if a Buyer is trying to save money, they would prefer to put 3% down instead of 10%. Now with this being said, there are some condo's that have not declined at all and there are some communities that are in law suits and can't sell unless they find a cash buyer.

Which community are you in? Is your condo a conversion or was it built to be a condo from the beginning.

I am currently working short sales and one thing I can definitely tell you......the Lenders would prefer to work with Real Estate professional then directly with homeowners. They are over work and under paid and if they can put the work off on a Realtor, then they will gladly pay us. If you end up calling your lender back, they may give you a completely different answer.

Have you tried to rent your unit? There are a lot of rentals on the market now, but I hear that the ones with garages are renting sooner than the high rises with no garage.

Feel free to give me a call for more information and explanations.
Enjoy your day!
0 votes
Lisa Hill, , Port Orange, FL
Mon Feb 4, 2008
I have a sale pending right now, and my seller is going to have to bring $85,000 to the table to close! BUT, in the last month, everything has improved. And now that Amendment 1 has passed, hopefully the market will improve even more. I'm not that far from you, in the Daytona Beach area. You've already received a couple of good answers. Wade offered some good advice for marketing. See if you can hang in there and get a sale.
0 votes
Julie (Toon…, Agent, Hilton Head Island, SC
Mon Feb 4, 2008
Ouch - not a good position to be in at all. Perhaps if you talk to your lender about renegotiating the terms of the loan to something you can afford, they may be willing to help you - go to the lender who originated your loan and talk to them about it rather than the person in the corporate office who is servicing the loan.

You should also talk with a local real estate agent (I know a good one in the Jacksonville area if you don't already know someone) about what the options are in your market and if your market looks like it may turn around shortly?

Foreclosure is not a good solution if you can avoid it. It will affect your credit and your future interest rates for years to come, not to mention the potential tax consequences you may face. If you don't have a choice, you don't have a choice but get good sound advice from local professionals before you make a decision. They know your market best.
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