So here's my situation:
Last year my husband was offered a job in California (we were in MD at the time) that was a great opportunity for us. At the time we had no idea where the market and economy was headed. He took the position and relocated in December. We made some repairs updates to the house as advised by our RE agent, and put it on the market in the spring.
Long story short, the house hasn't sold, were currently listed at a break-even amount (which doesn't begin to pay for the thousands of dollars we still owe on the repairs and updates) with barely no showings or interest at this point. We had one offer that fell through after the appraisal came back at "substantially lower" than the asking price. They wouldn't tell us the exact number, of course.
Our lender says they don't do short sales unless you're behind in payments, which so far we're not, and we were trying to keep it that way because we're in a very small apartment in a not so great neighborhood that was supposed to be temporary until our house sold, and desperately need to move into a more suitable rental home for the long term.
Anyhow, after months of paying both a rent and a mortgage our savings are gone, the credit cards, while not maxed, are about as high as we can afford to go with the current rent/mortgage situation. A lot of our relocation costs had to be charged so they're several thousand dollars higher than before we moved, and expected to pay off with the proceeds from the house, which isn't going to happen.
We had a few unexpected bills (emergency room visit-- hello deductible) and we're now looking at either falling behind in our payments or resort to living off our credit cards (which will eventually get us to the point where we fall behind with a bigger balance to deal with)
We don't qualify for Chap 7 so we can't use that to get us out from credit card debt if we go that route anyhow.
I've scrimped and saved as much as I can to keep us afloat and there's very little left in our budget that isn't a necessity. We've stopped paying into our 401k, we never eat out, our "new" clothes are second hand and only when absolutely necessary, we canceled things like netflix and other subscriptions, I cut everybody's hair (including my own), and we only get basic cable and internet access (cable modem) because my husband requires high speed internet for work. It's all very depressing because we're actually making more money than we ever have, we should be having a good life, not living paycheck to paycheck!
Something has to give. I'm inclined to say it's the house. We're not living in it, every payment we make is money lost as the prices of homes in the area continue to drop and we get more upside down every month. We're not gaining any equity at all with these payments, and we're still carrying insurance costs, taxes and utilities (though considerably less than if we were living there, we still have to keep the house heated at least to a minimum, and have kept the other utilities on for prospective buyers)
I'm confused by our options though. Everyone says do a short sale it's better, but you have to find a buyer first, and get the bank to approve it and then half the time it all falls through anyhow. Is this really a good option?
We could try deed in lieu of foreclosure, but I'm not sure if we could do that because refinanced not that long ago. The money, for the most part, was put back into the house for some badly needed updates and repairs. It's pretty old.
Or we could just stop paying and let the bank initiate a foreclosure. Again, how would this affect our ability to rent next March when our lease is up and we are able to move into something more suitable?
Since Md allows deficiency judgments, we may need to file Chap 13 after its done as well, so I'm pretty much resigned to having our credit scores tank after all is said and done, my concern is right now. How hard is it to rent a place while going through a foreclosure or short sale, and what about stopping payments? How long does it take for those missed payments to start showing up on your credit?
It's all very confusing, most of the info out there seems to be geared toward saving your house-- but we don't care about "saving it" we don't live in it, and can't move back into it even if we wanted to because it's on the wrong side of the country from my husband's job. There's no equity to save at this point.
It's doing us no good at all to keep it. We considered renting it out, but we'd be coming up short about $500 every month, while that could buy us time, its not tenable for the long term and having a tenant would only make selling it that much harder.
Any advice on what steps to take? And I get conflicting info online about having a lawyer for a foreclosure. There don't seem to be many foreclosure attorneys anywhere in the area our house is located, or do we need one in CA since that's where we live now? Or do we not need one at all?
Is there anyone that we should have on our side for all of this? Should we talk to a bankruptcy attorney now in case there's a deficiency judgment and we need to file after the fact?
I'm unsure what our first steps should be. Any advice?
Last year my husband was offered a job in California (we were in MD at the time) that was a great opportunity for us. At the time we had no idea where the market and economy was headed. He took the position and relocated in December. We made some repairs updates to the house as advised by our RE agent, and put it on the market in the spring.
Long story short, the house hasn't sold, were currently listed at a break-even amount (which doesn't begin to pay for the thousands of dollars we still owe on the repairs and updates) with barely no showings or interest at this point. We had one offer that fell through after the appraisal came back at "substantially lower" than the asking price. They wouldn't tell us the exact number, of course.
Our lender says they don't do short sales unless you're behind in payments, which so far we're not, and we were trying to keep it that way because we're in a very small apartment in a not so great neighborhood that was supposed to be temporary until our house sold, and desperately need to move into a more suitable rental home for the long term.
Anyhow, after months of paying both a rent and a mortgage our savings are gone, the credit cards, while not maxed, are about as high as we can afford to go with the current rent/mortgage situation. A lot of our relocation costs had to be charged so they're several thousand dollars higher than before we moved, and expected to pay off with the proceeds from the house, which isn't going to happen.
We had a few unexpected bills (emergency room visit-- hello deductible) and we're now looking at either falling behind in our payments or resort to living off our credit cards (which will eventually get us to the point where we fall behind with a bigger balance to deal with)
We don't qualify for Chap 7 so we can't use that to get us out from credit card debt if we go that route anyhow.
I've scrimped and saved as much as I can to keep us afloat and there's very little left in our budget that isn't a necessity. We've stopped paying into our 401k, we never eat out, our "new" clothes are second hand and only when absolutely necessary, we canceled things like netflix and other subscriptions, I cut everybody's hair (including my own), and we only get basic cable and internet access (cable modem) because my husband requires high speed internet for work. It's all very depressing because we're actually making more money than we ever have, we should be having a good life, not living paycheck to paycheck!
Something has to give. I'm inclined to say it's the house. We're not living in it, every payment we make is money lost as the prices of homes in the area continue to drop and we get more upside down every month. We're not gaining any equity at all with these payments, and we're still carrying insurance costs, taxes and utilities (though considerably less than if we were living there, we still have to keep the house heated at least to a minimum, and have kept the other utilities on for prospective buyers)
I'm confused by our options though. Everyone says do a short sale it's better, but you have to find a buyer first, and get the bank to approve it and then half the time it all falls through anyhow. Is this really a good option?
We could try deed in lieu of foreclosure, but I'm not sure if we could do that because refinanced not that long ago. The money, for the most part, was put back into the house for some badly needed updates and repairs. It's pretty old.
Or we could just stop paying and let the bank initiate a foreclosure. Again, how would this affect our ability to rent next March when our lease is up and we are able to move into something more suitable?
Since Md allows deficiency judgments, we may need to file Chap 13 after its done as well, so I'm pretty much resigned to having our credit scores tank after all is said and done, my concern is right now. How hard is it to rent a place while going through a foreclosure or short sale, and what about stopping payments? How long does it take for those missed payments to start showing up on your credit?
It's all very confusing, most of the info out there seems to be geared toward saving your house-- but we don't care about "saving it" we don't live in it, and can't move back into it even if we wanted to because it's on the wrong side of the country from my husband's job. There's no equity to save at this point.
It's doing us no good at all to keep it. We considered renting it out, but we'd be coming up short about $500 every month, while that could buy us time, its not tenable for the long term and having a tenant would only make selling it that much harder.
Any advice on what steps to take? And I get conflicting info online about having a lawyer for a foreclosure. There don't seem to be many foreclosure attorneys anywhere in the area our house is located, or do we need one in CA since that's where we live now? Or do we not need one at all?
Is there anyone that we should have on our side for all of this? Should we talk to a bankruptcy attorney now in case there's a deficiency judgment and we need to file after the fact?
I'm unsure what our first steps should be. Any advice?
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