Posted on: 04th Sep, 2006 04:11 pm
i was buying a home with an interest only loan. later i got an equity line of credit to fix it up for sale. home values were going up in ca during that time. i fixed it up. i found the house i want to buy and decided to rent my first house until it sells. i was able to buy the second house and find a renter for the first. then the renter didn't like having to show the house and moved out within a month. housing prices have been going steadily down and interest rates up and i can't sell the first house and i'm only asking what i owe. i can't afford to pay both mortgages and the credit line. foreclosure on the first house is inevitable. i just want to get rid of the house. can i do a deed-in-lieu or what about a quit claim deed. i have the same lender for the first & equity line. something needs to happen fast. please help, and thank you.
jodi
jodi
Welcome MJ,
A deed in lieu foreclosure will affect your credit and will lower it by around 250 points. However, the deficient amount resulting from the sale of the property will be forgiven but you will have to pay taxes on the forgiven amount as IRS will consider this as your income.
Try out for a short sale if possible as it will have a lesser effect on your credit. It will lower your credit score by 75-100.
To know more check out the following:
Avoid Foreclosure with a Deed-in-lieu
Short Sale Affects Credit Score - how many points do you lose?
A deed in lieu foreclosure will affect your credit and will lower it by around 250 points. However, the deficient amount resulting from the sale of the property will be forgiven but you will have to pay taxes on the forgiven amount as IRS will consider this as your income.
Try out for a short sale if possible as it will have a lesser effect on your credit. It will lower your credit score by 75-100.
To know more check out the following:
Avoid Foreclosure with a Deed-in-lieu
Short Sale Affects Credit Score - how many points do you lose?
I'm seeing lots of mixed messages here. I have two investment properties I can't afford. Do banks accept DIL for investment property? If NOT, then what are the options?
Hi Julie
As far as I know, you will be able to do a deed in lieu for your investment properties. But you will have to contact the lender and apply for a DIL. It will be the lender's discretion whether he will accept it or not. You should also note that deed in lieu affects credit score. To know more about how it affects credit score, check out the following link:
http://www.mortgagefit.com/deedinlieu/affectcredit.html
Thanks.
As far as I know, you will be able to do a deed in lieu for your investment properties. But you will have to contact the lender and apply for a DIL. It will be the lender's discretion whether he will accept it or not. You should also note that deed in lieu affects credit score. To know more about how it affects credit score, check out the following link:
http://www.mortgagefit.com/deedinlieu/affectcredit.html
Thanks.
what if some one else is on the deed and refuse to sign can i ask for a deed in lieu or a quit claim. thanks anthony
Welcome Anthony Harper,
You should consult an attorney and check out the option of partition law suit. In this case the court will sell off the property and divide the sale proceeds to both of you. But, remember, once you sell off the property, your mortgage can become due and the lender may ask you to pay it off immediately.
You should consult an attorney and check out the option of partition law suit. In this case the court will sell off the property and divide the sale proceeds to both of you. But, remember, once you sell off the property, your mortgage can become due and the lender may ask you to pay it off immediately.
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