Suggestions Please

[soscared123]

I wanted to post this and get some suggestions from those in the know here!

As you may recall my Chapter 7 was recently discharged. I live in south Florida. My home is mortgaged with my credit union and I have a HELOC.
I owe 106,000 on mortgage and 65,000 on Heloc. I did not reaffirm the mortgage.
My total monthly payment including heloc is 1,165.00.

Here is the situation. I am 50 years old and want to retire in my mid 60's. I want to own my home when I retire so I won't have a mortgage. I still have 20 years on this mortgage. I want to move into a condo so I don't have to worry anymore about a yard, fence, roof, etc. I can't afford to keep up this house.

So......I owe 171,000. House is worth that if not a little less.
Should I do a short sale?
Should I let it go into foreclosure and stay in the house as long as I can and save that money? I just don't know what is most beneficial for me. I want to be as smart about this as I can. Remember, I want to retire in 15 years with my home paid for.

Thank you for any and all suggestions!

[mynameainttracy]

Talk to a realtor and see if they think you can sell it outright and get near value first. If you go the FC or SS route it will be a long time before you can buy again.

[RedLight]

The only benefit of a short sale is that it would probably be quicker than a foreclosure. That way, the seasoning period can start sooner for you to purchase if that is in your long-term goals. As stated above, I would get a CMA from a reator and see where you are at financially.

[soscared123]

If you go the FC or SS route it will be a long time before you can buy again.

mmmmm......I thought because it was discharged in my BK, the foreclosure would not show up on my credit report. Am I wrong about that?
Yes, I will want to purchase a small condo at some point.

[LadyInTheRed]

The foreclosure will not show up on your credit report, but it will be a public record available to a potential lender.

[Drazil65]

If you want to go the short sale route do yourself a favor and get an appraisal up front. We stopped making payments, then between 60 and 90 days after the first missed payment we got the appraisal. As we expected it was worth less than what we owed (yes it was discharged in chp 7 and not reaffirmed), so we took the appraisal to the bank and said look you got 2 choices, we do short sale and you get something back on this discharged property or go ahead and start the foreclosure. Short sales typically take a long time because the bank does not approve it or sits on it. We put the ball in their court and they played. It sold in 5 months (closed in 7 months) and the bank only lost a total of $13,000 from what our loan payoff was. We had 10 months of payments saved up when we moved.

[soscared123]

Thanks everyone for your input. I just don't know what to do!

[mynameainttracy]

My foreclosure only showed up in comments for those creditors on my credit report. I disputed until the comments disappeared but when I filled out my loan application I couldn't lie when asked if I had ever had a FC and my LO wanted to know what happened with the property.

[soscared123]

mynameainttracy did you get the loan??

[nioka]

"Here is the situation. I am 50 years old and want to retire in my mid 60's. I want to own my home when I retire so I won't have a mortgage. I still have 20 years on this mortgage. I want to move into a condo so I don't have to worry anymore about a yard, fence, roof, etc. I can't afford to keep up this house."

I am retired, ten years now, and from my experience nothing I planned worked out. From the time I was 50 on my plans changed from when to where many times. In the end as I was about to retire I decided I really didn't want to retire and would continue to work as long as I could. That was my plan. I worked for a forture 500 company who had different plans and every one that was eligible for retirement was given the boot. Forced out I had a few locations I thought would be good for retirement only to move several times still looking for that perfect place. (BTW, Perfect Place, doesn't exist).
I don't have any suggestion for your other questions, but I can say planning that far ahead is an exercise in futility. I think it would be better to concentrate on growing finances/investments so that when you finally do make it to retirement you will have the means to do what you want to do at that time.

[mynameainttracy]

We were preapproved but couldn't find a house to buy so we didn't end up going through the underwriting process. It did take us several tries before we could even get preapproved.

[soscared123]

Thank you Nioka, very sound advice!