Posted on: 12th Sep, 2009 09:06 pm
Hi all, I have a home that just a year ago I rented out as we bought a 2nd home because the other home was to small for our family. In doing this we knew we would probably have to come up with about $300 extra a month to add to the rent to make the mortgage payment, ok fine so far. As the market continued to dive and our renters are moving out we have discovered by looking at other rental homes an the area that we would only be able to rent it for $1000 a month at best, which will now put us $500 in the whole very month. It desperately needs new carpet and paint that we can't afford. With my wife's college tuition's this has put us in a bind. We originally thought we would be able to sell the rental and break even after about 5 years which won't be the case. The rental FMV is around $140K, we owe $220K. After long discussions we have decided the best for our family is to let this rental go. We are not behind in payments at this point, but we wont be making next months mortgage pymt on the rental. We need to get rid of this home regardless of the credit implications, we are not interested in trying to restructure the loan. What would be our best approach, Deed in Lieu, foreclosure?, I don't believe anyone will do a short sale. We also are afraid of a deficiency judgment, possible lien on our current home, and the 1099 tax implication. Keep in mind this was our primary residence for the last 4 out of 5 years. Whats the best way to get out from under this with the least of financial damage? Thanks
northnev2
DIL will be one of the best option to go for as it will not hamper your score so drastically.So in my opinion you should also think about finding a new tenant but if it not at possible to get a new tenant then better go for DIL.
DIL will be one of the best option to go for as it will not hamper your score so drastically.So in my opinion you should also think about finding a new tenant but if it not at possible to get a new tenant then better go for DIL.
TA this time you want to start with Shart salefirst if that is not anoption try doign deed in lieu insted going for foreclosure.
Foreclosure should be yoru last option
Foreclosure should be yoru last option
Should I be late on payments before asking for a DIL?
following are conditions for DIL
1) in default and don't qualify for any of the other loan mitigation option;
2) attempts of selling the house before foreclosure were unsuccessful;
3) don't have another mortgage in default.
1) in default and don't qualify for any of the other loan mitigation option;
2) attempts of selling the house before foreclosure were unsuccessful;
3) don't have another mortgage in default.
Hi, I owe $220k and FMV is around $140k, it won't sell. Thanks
Hi northnev,
It is true that lenders generally accept a deed in lieu of foreclosure when you are delinquent on your payments. In my opinion, you should first discuss your situation with the lender and check out if he accepts a deed in lieu in your case. If the lender does not accept your request, then you can think about getting delinquent on your loan payments.
It is true that lenders generally accept a deed in lieu of foreclosure when you are delinquent on your payments. In my opinion, you should first discuss your situation with the lender and check out if he accepts a deed in lieu in your case. If the lender does not accept your request, then you can think about getting delinquent on your loan payments.