Posted on: 06th Aug, 2008 08:29 am
Hi,
My 22 year old son bought a small house in a bad neighborhood when
he was 19. He lost his job and could not keep up payments and had
bad experience with several renters. The bank is filing foreclosure but
has sent him short sale info. He now has a job but is out of the area
and can't keep up with two payments for a place to live. The idea of
someone buying in that neighborhood is iffy at best and not for enough
to cover the original mortgage (values have dropped). Should he
just let them foreclose? And how long does it take and will it cost him
money?
My 22 year old son bought a small house in a bad neighborhood when
he was 19. He lost his job and could not keep up payments and had
bad experience with several renters. The bank is filing foreclosure but
has sent him short sale info. He now has a job but is out of the area
and can't keep up with two payments for a place to live. The idea of
someone buying in that neighborhood is iffy at best and not for enough
to cover the original mortgage (values have dropped). Should he
just let them foreclose? And how long does it take and will it cost him
money?
Hello locotz,
There are so many sad situations in the housing market lately.
Your son will want to keep a foreclosure from appearing on his credit report if at all possible. There is always a possibility someone will by the home no matter where it is located...who knows what will happen if the home is priced right. Has an agent savvy in distress sales & market for that area been consulted? Prices have readjusted almost everywhere but if the property is priced right there's a chance...that's what short sales are about.
If the bank has sent info regarding short sales they must know the property won't cover the loan balance.
The approval of an offer on a short sale is lender dependent - it won't really matter what your son feels is a fair price. As far as costs go everything is negotiable - tell any agent you contact the property needs to be priced for a quick sale (visit my blog [link below] for tips on valuing you home for a quick sale).
Foreclosure laws & their individual timelines vary by state. Become familiar with your state's foreclosure guidelines just for your own information.
There are so many sad situations in the housing market lately.
Your son will want to keep a foreclosure from appearing on his credit report if at all possible. There is always a possibility someone will by the home no matter where it is located...who knows what will happen if the home is priced right. Has an agent savvy in distress sales & market for that area been consulted? Prices have readjusted almost everywhere but if the property is priced right there's a chance...that's what short sales are about.
If the bank has sent info regarding short sales they must know the property won't cover the loan balance.
The approval of an offer on a short sale is lender dependent - it won't really matter what your son feels is a fair price. As far as costs go everything is negotiable - tell any agent you contact the property needs to be priced for a quick sale (visit my blog [link below] for tips on valuing you home for a quick sale).
Foreclosure laws & their individual timelines vary by state. Become familiar with your state's foreclosure guidelines just for your own information.