Hi, We bought our house with 18% down in 2004 for $370K with a 30 year fixed loan. Although we can afford our

Asked by Maggie Homeowner, Marlborough, MA Sun Feb 22, 2009

mortgage payments just fine, we no longer want to live in our house. We can't sell our home as houses in our neighborhood are selling for less than 50% of our purchase price. We are thinking of foreclosing on purpose as it is highly unlikely we will ever be able to sell our house without a loss.

Who can we talk to so that we know what exactly we are getting ourselves into if we go down this route? Thanks!

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Amy Mullen’s answer
Amy Mullen, Agent, Shrewsbury, MA
Fri May 14, 2010
Hey Maggie!

There are a few options for you but really think about your credit situation in the future. The question has been answered a few times in these posts but please give me a call if you would like to discuss this further. I'm very local to you and would be happy to help sort out all the information you have received in these posts.

0 votes
Anthony Allen, , District of Columbia
Wed Jul 1, 2009
Check out my blog on what a foreclosure vs. short sale will do to your credit. I would suggest a short sale. It will cost you nothing and with the new federal program you can get $1,000 in moving expenses for doing a short sale vs a foreclosure! Contact me for additional information yourlife70@gmail.com
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American-mus…, , Marlborough, MA
Tue Jun 23, 2009
Hi Maggie, I am sorry to hear of your difficulties. I agree with Alan's sentiment. In addition to the extreme financial difficulty you will be imposing on yourself, you will also impose added financial difficulty on your neighbors as a result of your foreclosed property further reducing the value of there property. We all make financial decisions that come with a certain amount of risk. In the investment world, you would take your losses and use your remaining capital to start building wealth in a new area. In the name of good karma and your continued financial health I would try renting it out or take the hit and move on. Best of luck to you!
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Joan Hathaway, , 01778
Mon Feb 23, 2009
Renting the house is your option even if you cannot cover the mortgage. Better to put some money in each month than go the foreclosure route. Where would you go? If you let the house go to foreclosure, you will probably not be able to rent yourself as landlords do credit reports before they rent to prospective tenants. As for a short sale, unless you have a job loss, etc. the lender is not going to be of much help as no longer wanting to live in your house is not going to want to make them pick up the loss on a short sale.
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John Savigna…, Agent, Hopkinton, MA
Sun Feb 22, 2009
Renting it out would be a good option. find out what houses like yours are renting for and see if covers your monthly expense,- mortgage, tax and insurance. even if you lose a little each month its better then foreclosure.
Other than that, talk to your bank and or a real estate attorney specializing in short sales. Best of luck
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Wen Farina, Agent, Reading, MA
Sun Feb 22, 2009
I agree that a foreclosure will be the worst for you. If you get foreclosed on you will not be able to get another loan for years to come and therefore will not be able to buy another home; unless you buy it in 100% cash. The short sale route is the best option if your lender approves it, another would be, if you really dont want to live in that house anymore, renting it. Even with a short sale it would be difficult to get financing to get another home (unless you just want to rent for a few years). I've been involved in quite a few short sales and they are not fun but a much better option than a foreclosure; if you have any questions feel free to contact me,
Century 21
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Alan Strange, Agent, Westminster, CO
Sun Feb 22, 2009
Going through a foreclosure can be a devasting event. Aside from the ethical issues involved in letting go of an obligation we put our names to it's wreaks havoc on many aspects of your life. A few major things to consider is the affect on your credit. It's unlikely that another mortgage company will lend you money to buy another house for seven years. Throughout the process of foreclosure you will be constantly contacted by the lender for payment. When they take back the house and sell it again there will be a difference in the amount they loaned and what they got for it. That difference in CO can be filed as a deficiency judgement against the previous owner. These are just a few things you'll be looking at.

Some alternatives to foreclosure: contact the lender and explain your thoughts, see about a modification, ask about a short sale. Try to think of different routes than foreclosure. Good luck to you.
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