Letting the house go vs Selling question?

[Mark80]

[justbroke]

However my wife spoke with a real state agent today and told us we shouldn’t do that. That we can get the mortgage company to lower what the home is worth and we can sell it to get rid of it. Which in the long run would be better when we go and try to get a new loan down the road?

Have you guys ever heard of this, does it make sense to try?

There have been rumors that Banks are allowing write-downs of the mortgages, but not in any great numbers where it's a sure thing.

Also, many Realtors tell their clients that Short Selling is easy and Banks are easy to work with. (Not True)

What your Realtor seems to be talking about is a Short Sale. A short sale may look unfavorably, just like a foreclosure, although anecdotal wisdom suggests that it's marginally better.

If you go the "short sale" route... it can take a long time, and in the end, the sale may not even go through. (I tried a short sale, and it was dead on arrival with the Bank. Mine probably failed due to the $24K in back property taxes and another $13K current year pending.)

Of course, anything is worth a try these days.

[Mark80]

My biggest fear is reaffirming my house just to try and sell it, when I could just step away. So many extra what ifs with trying to short sale it and it doesn't sound like many positives. However my wife is flipping out about it now, mostly because she doesn't want our neighbors to know we got forclosed and my daughter to be made fun of at school.

But I just have a bad feeling about it, almost sounds like a scam!

[justbroke]

My biggest fear is reaffirming my house just to try and sell it, when I could just step away. So many extra what ifs with trying to short sale it and it doesn't sound like many positives. However my wife is flipping out about it now, mostly because she doesn't want our neighbors to know we got forclosed and my daughter to be made fun of at school.

But I just have a bad feeling about it, almost sounds like a scam!

Well, then the answer is simple. Bankruptcy. That way, you can say you gave it back to the Bank!

Bankruptcy is a business decision and is usually a smart one at that. In no other way can you shed $100Ks of debt. I will shed about $700K in debt in my Chapter 13.

[HHM]

Mark, next time, why don't you consolidate your posts into one thread

[Mark80]

Mark, next time, why don't you consolidate your posts into one thread

I seriously did not mean for all my topics to end up with the same outcome. I kept having some random thoughts and posted in a nervous panic this morning. I am really sorry as I am usually good about spamming things up!

[HHM]

The realtor is simply speculating.

Guess what Realtors were telling people 2 years ago..."go ahead, refinance, you can always refinance later". Seems like your realtor is telling the same story here.

Right now, we have not seen banks reducing upside down loans to current market value. So, I wouldn't hold out on that hope. Also, the practical question, even if you could, would that solve your financial problem (for most people, the answer is no).