I owe 172,000 to Citimortgage on the first and 79,000 on a home equity loan to Chase. I would say the house is worth about 160,000 to 180,000. Would if be futile to entertain thoughts of a short sale? Even if I could get a buyer to go for 180, would Chase let it happen? And by the time I pay real estate commissions, I'm thinking that I would be better off by letting it go into foreclosure. Anybody's thoughts on this would be appreciated. I need to stop paying on this as our plan is to move into our second home. We have lost considerable income the past 3 years and have been withdrawing from our 401K to keep making payments. Second home is upside down as well, but not as much. I am still working and chapter 13 doesn't work out well as DMI is too high because I can't use expenses for both places.
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First, in order to get a short sale, you need some sort of hardship. Whether a decrease in income is enough will depend on the lenders policy.
On the one hand, there is no harm it "trying" to do a short sale. But, there is also no meaningful "benefit" to you either, aside from the fact that if you can get an offer, you can get the house out of your name more quickly with a short sale than letting it go to foreclosure.
Unless you have an FHA loan, you cannot begin the short sale process until you have an offer.
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