Posted on: 20th Jun, 2009 01:13 am
my husband and i were responsible borrowers. we built the house of our dreams. it was on the high end of our budget but we could afford it. the dream fell apart when cracks started to appear in the ceiling, walls, and foundation.
in short we found out that it was built on hydro-collapsible soil. (when the soil gets wet it collapses.) the minimum tofix is $50,000 but it could be as high as $100,000. our contractor can't afford to fix the house even though the soil issue was discovered during the warranty period. he "said" he would file a claim with his insurance company, but he is dragging out the process. we hired a lawyer to help us through the process and make sure our rights were protected. we have plenty of evidence that our contractor, the city, and the developer knew there was a soil problem but built anyway. (3 out of the 6 phases have this problem.) we cannot rally homeowners to file a class action lawsuit (it is a small town with a corrupt government). the other kicker is that the insurance company has a clause in the policy that may not cover the cost to fix the problem. with the market being what it is, there in a zero chance of a home equity loan for us to cover the cost of the repairs. (not sure we should.) so we are forced into expensive litigation to a contractor that can't afford to pay and an insurance company that wont pay.
so here is the million dollar question. we are new facing the fact that our home is a lost cause. so what is the impact if we walk away? are there ways to minimize the damage to our credit? this is not our fault. there will be no government bail out for us. or do we continue to throw money into it and hope?
if we surrender to home, how do we get in conact with the lender. is it possible to send a letter?
in short we found out that it was built on hydro-collapsible soil. (when the soil gets wet it collapses.) the minimum tofix is $50,000 but it could be as high as $100,000. our contractor can't afford to fix the house even though the soil issue was discovered during the warranty period. he "said" he would file a claim with his insurance company, but he is dragging out the process. we hired a lawyer to help us through the process and make sure our rights were protected. we have plenty of evidence that our contractor, the city, and the developer knew there was a soil problem but built anyway. (3 out of the 6 phases have this problem.) we cannot rally homeowners to file a class action lawsuit (it is a small town with a corrupt government). the other kicker is that the insurance company has a clause in the policy that may not cover the cost to fix the problem. with the market being what it is, there in a zero chance of a home equity loan for us to cover the cost of the repairs. (not sure we should.) so we are forced into expensive litigation to a contractor that can't afford to pay and an insurance company that wont pay.
so here is the million dollar question. we are new facing the fact that our home is a lost cause. so what is the impact if we walk away? are there ways to minimize the damage to our credit? this is not our fault. there will be no government bail out for us. or do we continue to throw money into it and hope?
if we surrender to home, how do we get in conact with the lender. is it possible to send a letter?
krd
Welcoem to the forum
Consequence of walkign away from your house, he lender will probably forclose the house and it will have a big impact on your report and credit score.
If there is difference in the amount you owe and the house was sold for, the lender may send you a 1099C or if wanted they may turn this to a collection agency
Good luck and feel free to ask
Welcoem to the forum
Consequence of walkign away from your house, he lender will probably forclose the house and it will have a big impact on your report and credit score.
If there is difference in the amount you owe and the house was sold for, the lender may send you a 1099C or if wanted they may turn this to a collection agency
Good luck and feel free to ask