I purchase a home in 2008. It has decreased 46% since then. What are my options, in terms of maintaining my credit score to get rid of this property?

Asked by Lvm, Milwaukee County, WI Fri Jan 28, 2011

I thought I bought on the bottom end of the market. With the hundreds of billions of dollars printed by the government to ease financial pressure for banks, my question is, am I entitled to some relief? I do not want the penalties related to foreclosure or a short-sale, however, the place is too small for my growing family and I need to sell.

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Dp2, , Virginia
Tue Feb 8, 2011
The banks can't afford to hold their properties for much longer. Either the foreclosure moratoria will have to end, or the federal government would need to raise taxes to raise the funds (and most likely will print more money) to pay for another cash infusion for the banks.

Neither option will help you directly, but the prior one would hurt your sale more.

Unfortunately, since you mentioned you have to sell now, you have to choose between the least damaging of a few options: rent, sell via a swap, sell with creative financing, sell via short-sale, or foreclosure. Each option comes with its own caveats, and you already mentioned that you'd prefer to avoid the associated penalties from the latter 2.

If you wait too long to take decisive action, then the decision will be made for you (as it has for some other sellers).

Don't rush to make your decision, and don't stall hoping for 'better' options to present themselves.
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Linda S. Cef…, Agent, Franklin, WI
Tue Feb 8, 2011

There is much talk about the flood of foreclosures coming. I have been hearing this for more than eight months. They are coming on the market daily, however, I am also seeing a large increase in buyer activity and closings. This will help to counteract some of it. Of course, the less inventory, the higher the demand. And unfortunately, I have seen a rather large decrease in condos period, but $37,000 sale price? Something sounds fishy.
Web Reference:  http://www.lindacefalu.com
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Eli Givoni-S…, , Boca Raton, FL
Mon Feb 7, 2011
It sounds like a short sale would work for you. That will have the least affect on your credit.

We are a professional short sale service and would be happy to explain the process to you. Please call us directly to discuss your specific situation. Our services are FREE to homeowners. We look forward to hearing from you.

Eli Givoni, Director
Short Sale Department, LLC
Serving all 50 states
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Lvm, Both Buyer And Seller, Milwaukee County, WI
Sun Feb 6, 2011
Hi Linda,

My 46% is based on what a recent unit sold for a few weeks ago. I bought my unit for $80,000 a property recently sold for $37,000 which included $2,000 in seller concessions. (model match: same size, room count, condition, views, etc.) Taking into consideration the seller paid concessions, my property actually decreased $45,000 or 56.25%. Unbelievable numbers in my opinion. I know the price point isn't near what luxory homes are losing, but on a percentage basis, as low-middle class citizen it is mind blowing! I see you are an agent in the area, how do you forecast property values? I mean interest rates are only going up and unless the foreclosure moratorium continues, the area could potentially be flooded with new inventory. Increased supply surely can't be good for values.
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Linda S. Cef…, Agent, Franklin, WI
Tue Feb 1, 2011
Dear LVM,

This is an all too common situation for so many. I am curious as to where you got your 46% figure. Have you had an appraisal or a CMA or have you determined this by some other method?
Web Reference:  http://www.lindacefalu.com
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Dp2, , Virginia
Sun Jan 30, 2011
You might consider selling your property with seller financing. IMHO, it's better than a short sale or foreclosure, because you'd not receive any of the respective penalties. Yet, one of the downsides--especially since your property probably has little or no equity right now--is that you'd most likely receive little or no cash at closing. Nevertheless, you also wouldn't receive any cash back from a short-sale or foreclosure.

Another option is for you to do a property swap with another seller. This option also has its own caveats.

Please feel free to contact me.
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Dallas Texas, Agent, Dallas, TN
Sun Jan 30, 2011
Have you considered leasing the property.

BY the way NO one is entitled to anything in life. Short sale could be your better option HOWEVER most likely prevent a lender allowing you purchase another home for 2 years .

Confer with you bank contact a Realtor

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
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Robert Green…, Agent, Cherry Hill, NJ
Sun Jan 30, 2011
Hi Lvm. If you must move, you can rent it, and be a landlord. If that is not a viable option, a short sale should be less damaging to your credit than a foreclosure of you chose to stop paying your mortgage.

Robert Greenblatt
Keller Williams
Web Reference:  http://www.njhouseseller.com
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Jonas, , Houston, TX
Fri Jan 28, 2011

I'm sorry for your circumstance. Unfortunately you don't have many options. The only one that comes to mind is to lease it out. If their is no financial hardship many of the government programs are of no good to you. If I were in your situation I would lease it until the market in your area recovers. Also depending on your equity, you can dump it to get out quick.

Again, sorry for your circumstance.
All the best,

Jonas Mancuso
Remax / Lakeland
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Ruth and Per…, Agent, Los Gatos, CA
Fri Jan 28, 2011
Actually, you bought at the beginning of the fall.

If you sell as a short sale , your credit gets hurt no options, unless you bought it a LLC or a C Corporation
or can find Lawyers that can help you .

Check out the blog:


Good luck.
Web Reference:  http://www.ruthandperry.com
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