Interesting info in there about the family pressuring him into buying the house (WTF?). Also interesting that the FW responses are pretty similar to the ATOT responses.Im in the "industry" and i'm saying that we feed homeowners a bunch of crap for our self interest all the time. I have held several positions in the wholesale mortage industry, and am now a processor. I know what happens to borrowers that short-sale that arent explained what a deficiancy balance is. They are told its "better for thier credit", but then they end up oweing hundereds of thousands of dollars anyway.
I see what happens to borrowers who were told that a short sale is better, but then cant figure out why they dont qualify for a new home loan a year later, when they were never technically "forclosed" on.
I'm looking for different advice there (related to money only). Here I'm asking what to do more generally because I've been trying to meet the payments, but I've emptied out all my savings accounts trying to do so. I've rented out a room in my house and sold enough furniture that one room is completely empty. This is a desperate option, so I appreciate the perspective of others.
I thought I had it made, and I did for a while. My renter paid everything (2k/month) and promised (verbally--no contract) to stay for at least 5 years, but then walked out after a year and took 25k of furnishings that came with the house (included in price). The house is empty, so I can't use it as a vacation rental.
I should never have been approved for the mortgage. The second home has a 30 year fixed rate. My primary has a HELOC with variable rate currently at 4.75. I can't refinance (expand the line of credit or get a fixed rate loan to cover payments on the other house) because they'll see the other house and the debt I owe. It's on my tax return. I can't sell because I have to come up with the difference in my mortgage and what the actual selling price would be of that home (like being upside down on a car) and I'd have to come up with 100k or more at closing. This is money I don't have.
Also, the developer went belly up and only one unit (6 town homes each) of 30 was built. No amenities, no lawn care, no nothing. Place looks like it's deserted with tall weeds everywhere and pipes sticking out of the ground, so it's very hard to rent even at 1k. I'm guessing 800/month maybe--so long as renters in this gated community understand that they have to push the gate open with their own hands since power has been cut off for months!
boomhower
Diamond Member
- Sep 13, 2007
- 7,228
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Am I the only one curious how he got the loan in the first place? Or did you lose a significant portion of your income? Most banks will only allow 43% DTI, 50% at the very high end. Even factoring in a big arm adjustment getting to 90% is a hell of a swing. So he either has lost a big part of his income or committed mortgage fraud.
As others have stated a short sale is just as bad as a foreclosure and opens you up to being held liable for the difference.
If you foreclose you are usually better off financially. If you have single mortgage the it is likely non-recourse. You can give up the keys and walk away with just wrecked credit. If you have and 80/20 then the 20 is likely a recourse.
As others have stated a short sale is just as bad as a foreclosure and opens you up to being held liable for the difference.
If you foreclose you are usually better off financially. If you have single mortgage the it is likely non-recourse. You can give up the keys and walk away with just wrecked credit. If you have and 80/20 then the 20 is likely a recourse.
It's too far to bike to Orlando!
The second mortgage was a no-doc, stated income loan. I just got a small raise in fact, but Florida seems to be a 'recourse' state. I bike to work, shifted to prepaid cell, no landline, shower mostly at work, buy generic food, moved the AC up to 80, etc. because of this problem. I don't buy luxuries (like clothes, movies, etc). No subscriptions, gym memberships, or anything. So there's not much else to cut out!
Yikes, sounds like you got yourself into a mess. I'm not sure what I can tell you, but you may want to talk to your lender to see if they can arrange deferred payments to ease the pain.
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