Market Conditions in 34689>Question Details

Broke463, Home Buyer in 34689

My wife and I bought a home 7 months ago for $254K from the builder. The home wa already reduced $195K. The

Asked by Broke463, 34689 Sat Jun 6, 2009

appraisal at that time said the home as worth $260K. The builder holds our mortgage for three years in which time we have a balloon payment of ~$234K. The builder is now selling other homes adjacent to ours for $125K (verified on the MLS). It is going to be nearly impossible to obtain a mortgage for the $234K we owe in two and a half years due to the housing market. What do you recommend. Needless to say, we spent just about all our money on this house and we really love it.

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In the future you may want to do a bit more research before buying a property, even if the price was reduced $195K, because clearly it was never worth $195K more than what you paid.

Perhaps your local newspaper, or television station may have an interested in a story where a builder is selling properties at one price, holding the mortgage and lowering the price to sell similar product.
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0 votes Thank Flag Link Wed Jan 26, 2011
Before you put any more time and effort in the home, I would suggest you contact an attorney to go over the terms of the mortgage and see what your options are. Rather than go in to default, the builder may allow you to fix the interest rate and legnthen your loan time. Many builders do not have this option and have gone out of business. If your home is not worth 234k, there isn't one bank that will give you the 234k. There are many factors not mentioned that are needed in order to make a better assessment but the attorney would be at the top of my list.
0 votes Thank Flag Link Wed Jan 26, 2011
I noticed that you stated that you and your wife bought the home from the builder but noticed that you did not mention if the mortgage is through their mortgage company or an independent one and if you have already moved in or not. Have you taken possession of it already? Has clear title already been transferred to you and your wife?

Without knowing specifics, there are some options:

1. Stay put and continue paying your mortgage then when the housing market recovers you may decide to sell

2. Consult an attorney to read over the legally binding contract(s) which has already been mentioned

3. If you are considering moving and selling then you may be able to contact your lender and ask if they will accept less than what you owe on the mortgage (i.e. short sale) then use the proceeds to buy another house elsewhere.

~ Lana
0 votes Thank Flag Link Mon Jun 8, 2009
You have no alturnnative except to seek legal advise from a real estate specialist to evaluate your options.
If you need a referral please give me a call
Annette Lawrence
ReMax ACR Elite Group, Inc
727. 420. 4041
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0 votes Thank Flag Link Sun Jun 7, 2009
As you already suspect, real estate values may not rebound adequately in time for your balloon payment. I recommend that you have a real estate attorney carefully review all the terms written into your contract with the builder. It is likely that the contract provides terms for what would happen if you were unable to make your payment at the end of three years. It is unlikely that any of those terms provide any easy solutions for you. Act now to prepare yourself by knowing your legal and financial options.
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0 votes Thank Flag Link Sun Jun 7, 2009
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