Posted on: 10th Jun, 2009 12:31 pm
We are currently trying to sell a second home in Scottsdale, AZ. The house was purchased for my father-in-law to live in and we paid the mortgage. He moved into a nursing home last year and we have been trying to sell the house since then. It is in a senior community and cannot be rented according to the CC&Rs so it has been empty since then. We cannot afford to keep paying the mortgage and are exploring our options. We owe approx. $45K more on the house than the current listing price and interest is low even at that price.
What is our best option as far as deed-in-lieu vs. short sale, etc. We do not have a lot of cash reserves to pay the difference on the loan if it sold but we would explore this if coming up with that much money would be the best option. However, it would likely mean taking on that much in debt - not a pleasant thought. My major concern is what the consequences of a DIL or foreclosure might be to our other assets (savings, primary residence, etc.). Any advice is greatly appreciated.
What is our best option as far as deed-in-lieu vs. short sale, etc. We do not have a lot of cash reserves to pay the difference on the loan if it sold but we would explore this if coming up with that much money would be the best option. However, it would likely mean taking on that much in debt - not a pleasant thought. My major concern is what the consequences of a DIL or foreclosure might be to our other assets (savings, primary residence, etc.). Any advice is greatly appreciated.
Hi crazyvet!
Welcome to forums!
As you have mentioned that you do not have cash reserves to pay the deficient amount, it would be better if you could go in for a deed in lieu foreclosure. This will help you in selling off the property and you would won't be responsible for the deficient amount. The deficient amount will be forgiven by the lender.
However, as the mortgage is in your name, then this deed in lieu will badly affect your credit and lower your score by 250 points. As far as I know, your other assets will not be affected due to a deed in lieu.
Also you've mentioned that your father-in-law is in the nursing home. Is he on medicaid? If yes, then this selling of the property may make him ineligible for the medicaid benefits.
Feel free to ask if you have further queries.
Sussane
Welcome to forums!
As you have mentioned that you do not have cash reserves to pay the deficient amount, it would be better if you could go in for a deed in lieu foreclosure. This will help you in selling off the property and you would won't be responsible for the deficient amount. The deficient amount will be forgiven by the lender.
However, as the mortgage is in your name, then this deed in lieu will badly affect your credit and lower your score by 250 points. As far as I know, your other assets will not be affected due to a deed in lieu.
Also you've mentioned that your father-in-law is in the nursing home. Is he on medicaid? If yes, then this selling of the property may make him ineligible for the medicaid benefits.
Feel free to ask if you have further queries.
Sussane
crazyvet
Welcoem to forum.
You can check short slae or deed in lieu.
Both will affect yoru score but short sale may have less impact than the deed in lieu.
Good luck and feel free to ask
Welcoem to forum.
You can check short slae or deed in lieu.
Both will affect yoru score but short sale may have less impact than the deed in lieu.
Good luck and feel free to ask