Me again - Bank walked from foreclosure...

[florida]

The new policy will begin June 1 and does not have the mortgage company listed. Unfortunately, it cost more because it has been uninsured since Jan. of this year (and vacant for over a year).

I really hope we made the right decision - I know only time will tell.
We are going to bank as much money as possible and offer a settlement to the 2nd mortgage by the end of the year. Then we will start saving for a settlement offer on the first. If they really walked away like they stated - the plan should go well for us.

Does anybody know if there is a statute of limitations in Florida on when they have to intiate the forclosure process? If so - maybe we can reach that date. Our last payment was Dec. 2009.

[keepsmiling]

Just want to wish you luck with this. It will be GREAT if it works out!

[spidge]

How much is your 2nd's balance? You are basically paying the 1st to be removed from the title as the debt has been settled in the BK, so if they are removed would the payment on the 2nd be manageable? Would they not become the 1st? I wonder how long after the 1st is removed from the title would the 2nd be notified. Timing is everything here it seems.

I did not see if the forgiven debt tax liability question was answered. I would say that you settled it in the BK as that was the moment of insolvency, right?

Very risky and challenging. Keep us posted.

[florida]

The first mortgage is the one who suggested we settle the 2nd first. If not - they could foreclose quickly because the house is obviously worth more than the 2nd balance. I know this sounds strange - but this whole scenario was not our idea - but Etrade's (our 1st mortgage).

As far as tax implications - since it was incl and discharged in bk - I assumed we are ok there.? Really, they can't collect any funds - only the house - so we are just attempting to settle to remove the lien.

[TheBajan]

This is a VERY INTERESTING scenario. It raises so many questions in my mind. The number one question that keeps bothering me is if the house can be sold for $80,000... why is e-trade willing to settle with you for $25,000? It doesn't add up. I do wish you all the best and hope it works out for you. Please do continue to keep us posted.