Posted on: 12th Jun, 2011 12:36 pm
Hi,
Here's my situation...
Bought primary residence in 8/06 with interest only loan that I planned on refinancing 1 year later. Unfortunately I lost my job and was unemployed for 18 months. I liquidated my 401K to "do the right thing" and fulfill my contractual obligations.
Became gainfully employed in 9/08 and continued to make payments. After much personal deliberation, I have decided that it will take too much time to catch up given my current loan balance of $252000 and value of $190000. So, I stopped making payments in April 2011 and received my 1st notice that if I don't get caught up by July 2011 I will go in to foreclosure. I doubt my bank will approve modification (i've tried) or deed in lieu because they will say I make enough to make payments. My current mortgage payment is approximately 38% of gross income.
Here are my questions:
1. How long does foreclosure process take in MO? Should I stay in home rent free and ride it out, or should I move right away?
2. Is MO a non-judgement state - will they be able to come after me for the deficient amount of owe vs. sale price
3. Will I be taxed on the amount of owe vs. sale price
4. What will this do to my credit. I'm currently in the mid 700's (before my deliquent payments) with one outstanding credit card debt. No other debts.
Thank you in advance for your responses!
Here's my situation...
Bought primary residence in 8/06 with interest only loan that I planned on refinancing 1 year later. Unfortunately I lost my job and was unemployed for 18 months. I liquidated my 401K to "do the right thing" and fulfill my contractual obligations.
Became gainfully employed in 9/08 and continued to make payments. After much personal deliberation, I have decided that it will take too much time to catch up given my current loan balance of $252000 and value of $190000. So, I stopped making payments in April 2011 and received my 1st notice that if I don't get caught up by July 2011 I will go in to foreclosure. I doubt my bank will approve modification (i've tried) or deed in lieu because they will say I make enough to make payments. My current mortgage payment is approximately 38% of gross income.
Here are my questions:
1. How long does foreclosure process take in MO? Should I stay in home rent free and ride it out, or should I move right away?
2. Is MO a non-judgement state - will they be able to come after me for the deficient amount of owe vs. sale price
3. Will I be taxed on the amount of owe vs. sale price
4. What will this do to my credit. I'm currently in the mid 700's (before my deliquent payments) with one outstanding credit card debt. No other debts.
Thank you in advance for your responses!
Hi deannabrink!
Welcome to forums!
It will take around 60-90 days for a lender to foreclose the property in MO. Till the property is foreclosed by the lender, you'll be able to stay in the property. After the foreclosure sale is over, the lender will send you an eviction notice in order to leave the property.
Lenders will be able to seek deficient amount from you after the foreclosure sale is over. If he forgives the deficient balance, then you will be liable for paying taxes. Your scores will go down by around 250 points.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
It will take around 60-90 days for a lender to foreclose the property in MO. Till the property is foreclosed by the lender, you'll be able to stay in the property. After the foreclosure sale is over, the lender will send you an eviction notice in order to leave the property.
Lenders will be able to seek deficient amount from you after the foreclosure sale is over. If he forgives the deficient balance, then you will be liable for paying taxes. Your scores will go down by around 250 points.
Feel free to ask if you've further queries.
Sussane
My advice is to continue to making your payments. If you did not suffer an illness or a loss of job, you should always pay your debt. The reason why this economy and the housing market will not recover, is everyone thinks that because their home is upside down, they should walk away and have another foot the bill. Its unfair, and a burden on the economy. You are barely underwater, and the effects of foreclosure are much heavier than being 60k upside down. The market is a cycle. Everything will return and you will have equity again, just not today.
