Posted on: 13th Jul, 2009 05:28 pm
I currently live in a home I bought 5 years ago for $250,000. I'm making about 16,000 less per year than I did when I bought the home. Even when I bought the home, I couldn't really afford it and piled up unsecured credit card debt on house upkeep and daily living expenses (food and gas). I am a single mother of a teenage son, receive no help and just recently received a paycut. My house has been listed with a realtor since last October and no offers. I owe more on the house (1st and 2nd mortgages) than what it is worth. I recently had some flooding damage in the basement that I will not be able to have completely fixed becasue of insurance max benefit. I was hoping to be able to sell the house and do a short sale but I don't know who is going to want a house with cut up drywall in the basement. I have not paid my mortgage in two months since paying causes me to not be able to pay my other bills. My second and first liens are with the same mortgage company. I am at my wits end. I don't want to go into foreclosure, but I can't stay in this house! I submitted paperwork required for a loan modification but I don't even think that would help with how much my unsecured debt is. I asked my mortgage company about deed-in-lieu and they didn't really give me any answers. What are the first steps in obtaining deed-in-lieu? I would prefer a short sale but I am ready to get this over with as quickly as possible so I can start to repair my credit.
Hi Mel!
Welcome to forums!
You can write a hardship letter to your mortgage lender and apply for a deed in lieu foreclosure. Make sure that you explain your financial crisis to the lender clearly in the letter. The lender will judge your situation based on this letter. If the lender is convinced about your hardship, then he would accept your request.
However, you should remember that a deed in lieu will reduce your credit score by 250 points and this will remain on your credit report for the next 7 years. Apart from this, you'll not be able to get a mortgage in the next 2-3 years. But you can definitely take steps to improve your credit score after a deed in lieu. Check out the following page to know some simple steps to improve your credit score:
http://www.mortgagefit.com/credit-rating/credit-repair.html
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
You can write a hardship letter to your mortgage lender and apply for a deed in lieu foreclosure. Make sure that you explain your financial crisis to the lender clearly in the letter. The lender will judge your situation based on this letter. If the lender is convinced about your hardship, then he would accept your request.
However, you should remember that a deed in lieu will reduce your credit score by 250 points and this will remain on your credit report for the next 7 years. Apart from this, you'll not be able to get a mortgage in the next 2-3 years. But you can definitely take steps to improve your credit score after a deed in lieu. Check out the following page to know some simple steps to improve your credit score:
http://www.mortgagefit.com/credit-rating/credit-repair.html
Feel free to ask if you've further queries.
Sussane