Just found out my wife has been cheating on me, and I'll be getting a divorce. Here's the situation: We just refinanced our home in November and have virtually no equity in it. Since the housing market has turned, it's unlikely that we'd get what it appraised for in a sale. So what are my options? If we both stop paying the two mortgages, it will go into foreclosure, but I'm unclear what would happen after that. Could someone please explain?
2007-01-03 03:29:55 · 5 answers · asked by mario 1 in Business & Finance ➔ Renting & Real Estate
To answer a couple questions, I'm in the Seattle area. And the problem is that I doubt we could sell if for the amount that we owe on our mortgages.
2007-01-03 03:45:00 · update #1
Sell it and pay the rest back to the bank, a foreclosure will not be easy to overcome later.
YOu are unclear about foreclosure? The banks own it and take it back. They may or may not sell it. They dont really care if they sit vacent for awhile.
You however, will have a terrible time getting another house, or even renting. Avoid the foreclosure.
Maybe you guys can rent it out until things are better
2007-01-03 03:55:36 · answer #1 · answered by Landlord 7 · 2⤊ 0⤋
I'm betting dealing with your house will be harder then dealing with your relationship. If you are stead fast in your position with your wife and you can't heal and find out why she was cheating, then you will have to deal with the house.
You are correct, in this market a refi to %100 or close is a kiss of death. You are still better off selling it though and splitting the immediate loss with your wife and writing the lender a check up front. I know walking away seems painless, but it's not. As another has pointed out your credit will get dented for years. There is a second hit you will also take. The lender will get the property and hold a fire sale to get rid of it. In this market it will go cheap. Then they will take the over all loss and file a 1099 with the IRS as income to you. Yep...if the bank takes a loss of $50,000USD, you get taxed on it the next year. Then you not only have dented credit but you owe the IRS a bunch of money.
In the end if you can't reconcile with your wife, the very least you guys should do for each other is remain good business partners until you can unties things and find the right buyer who will give you more or at least be close to how much you owe.
Unrelated.. If you love her and she loves you...give it a try. If you guys didn't really love each other before, then chuck it. There are a lot of reasons people cheat. It's not cut and dry nor is it always sex or they are looking for someone new. Sometimes it's reaching out for a need they don't know how to deal with. It's at least worth trying to find out before you flush things.
2007-01-03 11:47:06 · answer #2 · answered by Thomas 4 · 0⤊ 1⤋
Try and sell it for as much as you can get. If you decide to let it go into foreclosure, you might want to ask a Realtor about a short sale. This is not good on your credit, but, it does clear you from the house and debt associated with the house. Let me know if you want me to refer you to an experienced Realtor in your area. I would love to help.
I am a Realtor and a mortgage broker
2007-01-03 11:46:53 · answer #3 · answered by homes_az 2 · 0⤊ 0⤋
It would be beneficial for you to sell the home and pay off the mortgages, rather than let it go to foreclosure, even if it costs you a little. It will cost you more later on in higher interest rates and the like because your credit rating is screwed.
2007-01-03 11:33:35 · answer #4 · answered by Phoenix, Wise Guru 7 · 0⤊ 0⤋
you need to speak with a attorney that deals with real estate. are you in new york? i know of one.
2007-01-03 11:42:12 · answer #5 · answered by prettysexycalves 3 · 0⤊ 1⤋