Posted on: 29th Oct, 2008 07:35 pm
I am a custom home builder that has been hit hard by the economy and am months behind on our house payment. We started a large in-law addition in late 2006 when the economy was stronger. The parent is not coming to stay with us and we want to sell the house and repay the mortgage in full. But we need time to complete the work (about 2-3 months with doing most of the work ourselves). If possible, we don't want to foreclose, short sale or DIL,
Here's our situation:
Live in PA. Refinanced home in 2006. At that time, it appraised at $525K (without addition). Today, with principle, interest, penalties, etc., we owe $510K. House was just appraised last month for $545K (assuming all work complete). There really isn't a lot of investment left to complete (just our labor). We've met with a few real estate agents who would like to market the house after the Christmas holidays in the lower $600K (assuming market increases and we can get the required appraisal). Our current mortgage payment of $4K a month is almost impossible to make.
Any feedback would be greatly appreciated!
Here's our situation:
Live in PA. Refinanced home in 2006. At that time, it appraised at $525K (without addition). Today, with principle, interest, penalties, etc., we owe $510K. House was just appraised last month for $545K (assuming all work complete). There really isn't a lot of investment left to complete (just our labor). We've met with a few real estate agents who would like to market the house after the Christmas holidays in the lower $600K (assuming market increases and we can get the required appraisal). Our current mortgage payment of $4K a month is almost impossible to make.
Any feedback would be greatly appreciated!
Welcome alwaysbuilding,
If you have any work incomplete towards the home, I suppose you should talk to the lender and request him to suspend the payments for a while. But the lender will probably ask you to sign a written agreement with the promise that you'll sell the home as soon as the work is finished and then repay the loan.
The appraised value obtained now isn't that bad. So, probably it will be a short sale because it's lower than what you owe. But you never know, if the home value appreciates by the time you complete the work, things could get better for you.
If you have any work incomplete towards the home, I suppose you should talk to the lender and request him to suspend the payments for a while. But the lender will probably ask you to sign a written agreement with the promise that you'll sell the home as soon as the work is finished and then repay the loan.
The appraised value obtained now isn't that bad. So, probably it will be a short sale because it's lower than what you owe. But you never know, if the home value appreciates by the time you complete the work, things could get better for you.
Hi alwaysbuilding!
I think you should consider the option of short sale once again. If you give away the property to the lender, he will somehow try to sell the property because he will want to recover his debts. Moreover your credit score will not be affected much as you will be paying the deficient amount.
Thanks
I think you should consider the option of short sale once again. If you give away the property to the lender, he will somehow try to sell the property because he will want to recover his debts. Moreover your credit score will not be affected much as you will be paying the deficient amount.
Thanks