Posted on: 12th Feb, 2009 02:52 pm
My spouse and I filed for Chapter 7 due to job loss. We thought our situation would improve, so we opted to reaffirm our mortgage with a lower interest rate.(no reduction of fees or principal). With the economic downturn, my husbands income decreased. After an extensive search in three different states, my husband landed a job. 200 miles away. We are currently leasing a house and our home has been on the market for 6 months on as a Short Sale, no luck. HFC states they will do a Deed in Lieu only after the property is re-keyed. So, no paper work until we no longer have access. This does not sound kosher. But I am afraid the longer we wait, the risk of a full blown Foreclosure increases. Any suggestions would be great. Thanks so much!
Hi cpgarrett,
I understand how difficulty you must be facing under these circumstances. But It's good to know that your husband's got a job now and I'm sure things will change for better in the days to come.
Since you say HFC said they would do a deed-in-lieu only after the property is re-keyed, you can take the property out of listing for the time being and send a Hardship Letter the bank so they agree to sign a deed-in-lieu.
However, In a deed-in-lieu the deficiency money is forgiven by the lender, thus it can affect your credit badly. A short sale, wherein you have to pay the deficiency amount, can hurt your credit by almost 75-100 points. On the other hand a deed-in-lieu like a foreclosure can cost you about 250 valuable points on credit your score.
I understand how difficulty you must be facing under these circumstances. But It's good to know that your husband's got a job now and I'm sure things will change for better in the days to come.
Since you say HFC said they would do a deed-in-lieu only after the property is re-keyed, you can take the property out of listing for the time being and send a Hardship Letter the bank so they agree to sign a deed-in-lieu.
However, In a deed-in-lieu the deficiency money is forgiven by the lender, thus it can affect your credit badly. A short sale, wherein you have to pay the deficiency amount, can hurt your credit by almost 75-100 points. On the other hand a deed-in-lieu like a foreclosure can cost you about 250 valuable points on credit your score.