Posted on: 14th Jan, 2010 02:13 pm
i co-own a 2-unit house with my brother that we both used to live in but is now a rental property. he is filing chapter 7 bankruptcy which i now know means that the liability of our primary and secondary mortgages will fall solely on me. our tenants are moving out this month and we have had no interest in ads we put out for re-renting it. payments are up to date as of today, but i cannot afford to pay this on my own as i am married and have other property and obligations. i do not want to file bankruptcy but would like to find the solution that would give me the least detrimental hit to my credit. the house cma shows its current value to be about 85% of what we owe on it. there are two lenders involved as well. i am worried about a deficiency judgment if i foreclose or short sale.
Hi jonpetkers!
Welcome to forums!
If the property goes into foreclosure or a short sale, you'll be liable for the balance amount. In my opinion, your best option would be to contact your lender and apply for a deed in lieu of foreclosure. This will help you in getting rid of the property as the lender will be selling it off and you won't be responsible for the balance amount. It will be forgiven by the lender. However, your credit score would go down by 250 points.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
If the property goes into foreclosure or a short sale, you'll be liable for the balance amount. In my opinion, your best option would be to contact your lender and apply for a deed in lieu of foreclosure. This will help you in getting rid of the property as the lender will be selling it off and you won't be responsible for the balance amount. It will be forgiven by the lender. However, your credit score would go down by 250 points.
Feel free to ask if you've further queries.
Sussane