Posted on: 30th Apr, 2010 06:19 pm
we refinanced our home in 2008 from a private contract to a high interest rate loan at aig. this was intended to be short term while we cleared our credit reports and to build a reported payment history. in july of 2008 our house was appraised at $179,000 and we were sitting at about 85% ($154,000) on the principal on a 30yr fixed at 9.5 % with aig.
a current apprasial only came it an $155,000 and even with credit scores over 640 we are not able to refiance which would now be 100% financing.
we applied for relief with aig but were denied any reduction in interest rate. they are willing to negotiate on
thier early payoff fee but we're stuck with a 9.5% loan and a $1500 per month p&i payment. some of the other options we have been offered are a short sale or quit claim deed.
we are considering all of our options but would like to know how each would impact our credit scores. my wife and i are both over 50 and aspproaching retirement so "downsizing" to reduce our monthly expenses sounds pretty good in this tough economy. we purchased this house as an investment but now have no equity. we are not currently in arears and would like to utilize the option that would impact our credit scores the least while reliving us of any obligation on the current loan.
we're seriously considering the purchase of a new manufactured home on leased land with approximately 10% down but don't want to send our credit scores into a nose dive getting out of our current situation.
we are anxiously waiting for your reply. thanks.
a current apprasial only came it an $155,000 and even with credit scores over 640 we are not able to refiance which would now be 100% financing.
we applied for relief with aig but were denied any reduction in interest rate. they are willing to negotiate on
thier early payoff fee but we're stuck with a 9.5% loan and a $1500 per month p&i payment. some of the other options we have been offered are a short sale or quit claim deed.
we are considering all of our options but would like to know how each would impact our credit scores. my wife and i are both over 50 and aspproaching retirement so "downsizing" to reduce our monthly expenses sounds pretty good in this tough economy. we purchased this house as an investment but now have no equity. we are not currently in arears and would like to utilize the option that would impact our credit scores the least while reliving us of any obligation on the current loan.
we're seriously considering the purchase of a new manufactured home on leased land with approximately 10% down but don't want to send our credit scores into a nose dive getting out of our current situation.
we are anxiously waiting for your reply. thanks.
Hi rwbaldwin,
If you are unable to get any reduction in your mortgage payments from the lender, it is better to get rid of the property. You can contact your lender for a deed in lieu of foreclosure in order to sell off the property. In this process, you'll have to transfer the property to the lender who will sell it off at an auction. However, the deficient amount resulting from the sale will be forgiven. But your credit score will get reduced by 250 points.
In case of a short sale, though you would be responsible for paying the balance dues, your score would get reduced by 80-100 points. You can chose any one of these options in order to get rid of your property.
Thanks
If you are unable to get any reduction in your mortgage payments from the lender, it is better to get rid of the property. You can contact your lender for a deed in lieu of foreclosure in order to sell off the property. In this process, you'll have to transfer the property to the lender who will sell it off at an auction. However, the deficient amount resulting from the sale will be forgiven. But your credit score will get reduced by 250 points.
In case of a short sale, though you would be responsible for paying the balance dues, your score would get reduced by 80-100 points. You can chose any one of these options in order to get rid of your property.
Thanks