I have rental property that is a pain to rent. Plus do to the amount of the house payment the rent is high. I cannot afford two house payments. I have my new home and it is in mine & my wifes name. My rental property is only in my name. Wife spoke to an attorney and was told just let it go into foreclosure due to the mortgage company being a big one and the amount of foreclosures happening today it was unlikely that the mortgage compnay would go after me for any monies owed. If they did then file bankruptcy. Can't afford to sell it or keep it any ideas?????
2006-12-21 15:32:17 · 9 answers · asked by Brad F 1 in Business & Finance ➔ Renting & Real Estate
Cannot afford to sell due to prepayment penalties the amount owed and seller/real eastate fees......
2006-12-21 15:42:11 · update #1
Your situation is one that many have faced and an entire flood of misinformed investors will face soon as many loans will end their fixed period and begin to adjust upward. There is a chance you might get a better rate on your new home and lessen your financial strain until you can sell the rental home after the prepay expires. You were not given a good loan on the rental by your lender. I know you have an adjustable rate loan because of the prepay penalty. Your lender also might have priced you for maximum rebate which would also have made your prepay a "hard" pre-pay. Regarding the attorney's advice I would have to say that is the worst move possible and the most unethical advice there could be. Foreclosure can remove the financial burdon only so much. The IRS views forgivness of debt much the same as earned income. Bankruptcy will not remove a tax lien. A deficiency judgement could result if the property doesnt sell high enough at auction. Filing a bankruptcy case will cost more including attorney fees than the prepay penalty. Trustee fees will likely cost close to as much as the prepay. My opinion would be to lease option the property for 1 -2 year's and then sell it when the prepay penalty has expired. Another thing to consider is that should you be foreclosed upon and then file bankruptcy the end costs compared to end benefit arent even close to making the latter choice a good idea. Your credit will have a double major negative and your insurance rates, future credit rates, and employment opportunities can all suffer costing you much more than at present.
2006-12-21 18:07:32 · answer #1 · answered by Kevin H 4 · 2⤊ 0⤋
Keep in mind that if you file for bankruptcy, your credit will be ruined for 7-10 years. So, you will not be able to buy a home, car, etc. Is there a reason why you cannot sell your house? Is it because the current sales price is lower than your mortgage? Can you have a realtor help you with renting out the property at a lower rental rate?
If you end up going down the bankruptcy/ foreclosure route, keep in mind that your credit, and your wife's, will be affected for a long time. Good luck!
2006-12-21 16:11:21 · answer #2 · answered by bubblegirl 2 · 0⤊ 0⤋
If you were to sell the house, does the value of the house cover the pre-payment penalties, mortgage, and all the other things you listed? If it does, sell the house for that price. Can you refinance your current home to cover the extra costs to sell the other house? (meaning do you have enough in equity to do that?) I don't know about letting it go into forclosure. I think I'd call several attorney's and get a concensus of opinions. Good luck!
2006-12-21 16:27:18 · answer #3 · answered by colleend01 3 · 0⤊ 0⤋
Foreclosure would ruin your credit for 7+ years. Have you contacted the lender of that mortgage and explained you are unable to make the payments? The lender may negotiate with you on payments or selling the property. The lender does not want the hassle of foreclosure and would most likely be willing to talk to you about selling it and/or forgiving the prepay penalty.
2006-12-21 16:07:33 · answer #4 · answered by amy23 3 · 0⤊ 0⤋
I feel for you, can you put an ad in the paper and say "take up payments" Make it sound real nice, put the word "sacrifice" in there somewhere. Maybe "due to unexpected health problems" or something like that. Good luck.
P.S. Ask Donald Trump. He has a website where you can ask him questions. I bet he'd know what to do.
2006-12-21 15:44:30 · answer #5 · answered by Becky F 4 · 0⤊ 0⤋
finally a question in my wheel residing house. REO or real assets Owned via the economic business enterprise isn't a good investment. surely that banks are no longer stupid. you will no longer be able to easily walk into the economic business enterprise and ask them for a itemizing of their foreclosure. in spite of the reality that banks are no longer interior the real assets company they are no longer likely to permit their final analysis get certainly destroyed via basically giving those properties away. Banks will consistently hire a realtor and attempt to get retail for the valuables, which in maximum circumstances they gets tremendously close to to many of the time. whilst making an investment in foreclosure the suitable thank you to do it quite is to get a itemizing of persons who're in preforeclosure or whose assets is going up for sheriff sale (in Pennsylvania). as quickly as you have this record you ought to get in touch with the owner and ask their permission to pass to the economic business enterprise and communicate on their behalf. it quite is right here the place you ought to get very good bargains on residences. you will then pass and negotiate the value with the economic business enterprise. as quickly as you attain an contract with the economic business enterprise there are then many go out concepts you may stick to. you may rapid turn the residing house via assigning or wholesaling the contract to a various investor. or you're able to do all the rehab and fix paintings youself and hire it out for a month-to-month money pass. So whilst dealing with foreclosure do no longer watch for the economic business enterprise to take administration of the valuables, you ought to get to the modern occupants and that's the place the real salary and exciting starts.
2016-10-15 10:13:59 · answer #6 · answered by Anonymous · 0⤊ 0⤋
I deal with this on a daily basis. Your best bet is to do a short sale and see if the agent or investor doing it can waive the 1099 and deficiency judgement.
If you're in Southern California, I can help.
Regards
2006-12-21 18:05:34 · answer #7 · answered by Anonymous · 1⤊ 0⤋
Have you checked out refinancing?
If you could refi your mortgage might go down making a more reasonable rent.
And how would a bankruptcy effect the home you live in?
2006-12-21 15:43:28 · answer #8 · answered by octopussy 3 · 0⤊ 0⤋
Whaat do you mean "Can't afford to sell it" ?
2006-12-21 15:36:32 · answer #9 · answered by Anonymous · 0⤊ 2⤋