Posted on: 09th Sep, 2008 09:09 pm
In 2005, my husband and I bought a house that we planned to live in but never did. Instead, a house that we had admired for ages was foreclosed on soon after we'd taken out a mortgage on the first house. We knew it was a lot to handle but couldn't pass up the opportunity. We ended up buying our dream house from the foreclosing bank and figured we could sell the first house with no problem. We were wrong. The house sat on the market for over a year with no interest. We finally could not handle paying the mortgage, taxes, etc. on an empty house and rented it. We had a hard time finding a tenant that could afford the rent and the rent payment still doesn't cover our expenses. It has been rented for almost 2 years now and the lease expires at the end of November. They don't want to renew and we know, given our past experience, that we will not have an easy time trying to sell the place or find another tenant. We paid $255,000 for the house when we bought it and it was appraised at $262,000. We owe about $195,000 on the house. We feel that we'd be lucky to get $250,000 for it in today's market and that it might take months or even years. Our payments are over $2,000 a month, not to mention utilities, repairs, etc. while it sits. A real estate agent would take at least 6% off the top of any sale. I guess you see where I'm going with this. It seems a loosing proposition to continue with it. Is a Deed in Lieu appropriate in our situation? Would any of our other assets be at risk with a Deed in Lieu? We do not want to jeopardize our dream home or anything else by taking this course of action. If a Deed in Lieu is appropriate for us, should we engage an attorney before talking with the bank? Any help and or advice would be greatly appreciated.
Hi Guest,
Welcome to the forums.
If you go for a deed in lieu, you'll be giving back property to the lender. But you've also thought of selling property on your own, right? Well, if in case you don't sell on your own and try for deed-in-lieu, it won't affect your assets. Deed-in-lieu waives the lender's right to collect deficiency payment. Hence, you can keep your assets protected if you go for it.
Take care
Welcome to the forums.
If you go for a deed in lieu, you'll be giving back property to the lender. But you've also thought of selling property on your own, right? Well, if in case you don't sell on your own and try for deed-in-lieu, it won't affect your assets. Deed-in-lieu waives the lender's right to collect deficiency payment. Hence, you can keep your assets protected if you go for it.
Take care
Thanks for your reply Sara. I've checked our lender's website and they do offer deed in lieu as an option. They want us to have the house listed for another 3 months and then we have to give them our asset/liability information. If we have a good bit in the way of assets, will that make them less likely to allow us to go the deed in lieu route. They want lots of very specific information. Again, any information is much appreciated.
Well, I suppose the lender wants to see what offers are being made on the home. That's the reason he wants to keep the house listed for 3 months. But did he ask you to keep paying for 3 months?
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If we have a good bit in the way of assets, will that make them less likely to allow us to go the deed in lieu route. "
If you can sell off the assets and pay off the loan, you don't need to go for deed in lieu.
may god bless you.
Samantha
"
If we have a good bit in the way of assets, will that make them less likely to allow us to go the deed in lieu route. "
If you can sell off the assets and pay off the loan, you don't need to go for deed in lieu.
may god bless you.
Samantha
I have house for sale as a short sale. I have a buyer. They are offering 399,000 I owe about 150,000 on the first and 390,000 on the second. The bank approved the short sale. The buyer lender and the title co are ready for closing. But the bank don't bank ride off the balance, and will leave me with a high balance as collectable unsecured loan. I have other properties and other assets. I been told that if the bank don't ride off the balance, to let it go forcecloser better and file bankrupcy. After surrending this property they can not come after my other assets.
Hi zenaida,
If the bank doesn't want to ride off the balance, then I am afraid that you will have to file a bankruptcy. You can consult an attorney for this purpose. I think filing Chapter 13 will be better as it helps to reorganize your finances. It also helps the debtor to get a better plan with which he/she can payback the loan in a period of 3-5 years.
If the bank doesn't want to ride off the balance, then I am afraid that you will have to file a bankruptcy. You can consult an attorney for this purpose. I think filing Chapter 13 will be better as it helps to reorganize your finances. It also helps the debtor to get a better plan with which he/she can payback the loan in a period of 3-5 years.
I have gone to 4 different lawyers and 2 of them tell me to forceclouser and file bankruptcy. The other two are telling me to close the sale becouse the price on the house will keep going down or if the auction the house I will have a bigger debt, and they still can go after me. At this point I think is better to close and wait for the bank to negotiate. the balance is going to be 183,000.00 which will become a nonsecure loan, the bak told me that it willl be a % of that amount and that I will take 5 to6 month for then to call me. Now I have to start getting ready and at that point I will see what I can do. Anybody has a better idea, let me know.
Hi Zenaida!
I would not encourage you to go for a foreclosure as it will have a negative effect on your credit score. A short sale in my opinion is a better option.
I would not encourage you to go for a foreclosure as it will have a negative effect on your credit score. A short sale in my opinion is a better option.