OT: Thinking about Short Selling my house...

[JRose]

Anybody have any advice? I'm getting conflicting reports on what it actually does to your credit, if your responsible for the portion of your mortgage that the bank had to eat, etc...

My credit is good, and this is my 3rd house, I have never defaulted on a loan in my life, I'm no deadbeat... That being said, I just don't know what to do, the housing market has completely collapsed in my area and no ones buying b/c of the plethora of Short Sales and Foreclosures on the market. I have a house that was worth over $250k a couple years ago, and now I can't even get a offer over $175k...

I've lost my second job which I need to get by, and am trying to get a job 4 hours north of where I'm at now, if I get it, I just don't know how I'll pay for rent there and a mortgage here. My house has been on the market here for almost a year, and I'm just not getting any real activity...

ANy suggestions?

J

 

[Queequeg]

Re: OT: Thinking about Short Selling my house...

Talk to an accountant and a Real Estate Attorney Josh.

Unless President Santa Claus has changed the paradigm, a short sale will still affect your credit. One friend did so and tells me his credit will be restored in a year. He's a smart guy for an engineer... aaaanyway, others I know have said screw it, took the money they got when they last re-fied, and walked away from their once inflated homes.

Some of the the old rules of foreclosure still apply.

Any chance of generating some income from your property? Will Mrs. Rose allow you to distribute your essence for pay? You are a fire fighter afterall!

Good luck and sorry about your quandry.

 

[JRose]

Re: OT: Thinking about Short Selling my house...

I'm not destitute by no means right now BUT, if I get this job up north, I'll have to take it, and if I take it, I gotta go. Paying my mortgage isn't the problem, but I've been anticipating getting this job for a while, and trying to sell accordingly. I just thought for sure almost a year later it would be sold.

I could rent it, but only for about half of what the note is (rentals have taken a hit too), and I could pay for it, but it would require me working 2 FT jobs for an undetermined amount of time...

I've heard your credit takes a 100 point hit with a SS, and if that's the case, I could probably be restored enough to buy again pretty quickly. I just don't want to be stuck renting for a long time once I move.

 

[Queequeg]

Re: OT: Thinking about Short Selling my house...

Renting or buying a second home for work purposes, may be deductable if the 2nd job is a temproary situation, or if you are "consulting". An accountant would know better. If leasing your residence to someone while you are away, the difference between your mortgage and the rent you recieve may be treated as a passive loss? Keep in mind the "cash flow" incentive of real estate investing is more than just a hook for aspiring slum lords, a la Carlton Sheets infomercials.

I can't blame you for not wanting to throw good money after bad, but keep in mind we are fully two years into this real estate down turn and even with Tropic-Stalin in power, these don't last forever.

The Sun belt is still a desirable relocation destination for frozen northerners and while I don't understand it, some choose to move to Alabama...

We'll get through this and you'll see your property values grow again.

Sorry I can't be of any real help.

Good luck

 

[Guest]

Re: OT: Thinking about Short Selling my house...

Any chance of using the FF equivilant of the Cop Nextdoor program, getting your new house halfprice, and using the current house as a rental property to make some cash on?

 

[Guest]

Re: OT: Thinking about Short Selling my house...

 

[Tuna921]

Re: OT: Thinking about Short Selling my house...

What is does to your credit is not good.I look at it all the time. The difference in the amount owed and the short sale price remains as a charge off. You can be also liable for the difference on your taxes.You need to ask a CPA for that, If I was going to short sale a house I would have the bank agree to show your loan as paid in full if they dont and you dont have equity let the have it back same difference on your credit....

 

[Phylodog]

Re: OT: Thinking about Short Selling my house...

I don't have any advice to offer but sorry to hear about your situation J. It sucks being part of the 20% in this country who actually give a shit about paying their debts. I lost one of my jobs in November and had to sell a rifle a few weeks ago to cover some bills.

Hope your situation improves soon Brother.

 

[JRose]

Re: OT: Thinking about Short Selling my house...

I might just pay on and suffer through it, what's a 100 hour work week anyways???

 

[Guest]

Re: OT: Thinking about Short Selling my house...

No chance of using it as a rental?

 

[The Mechanic]

Re: OT: Thinking about Short Selling my house...

I feel for you JRose. It has been real tuff the last 5 or so years and I don't see it getting any better for me either. The pay has been going down every single year by over $7K each year. At this point I am paycheck to paycheck.

 

[JRose]

Re: OT: Thinking about Short Selling my house...

Yeah, but rentals aren't fetching much, and it' a nice house, and I know how renters treat houses... That would stress me.

It is an option I've been considering. This place is flooded with rentals too, it would prove to be a challenge renting it too.

 

[Guest]

Re: OT: Thinking about Short Selling my house...

How good of friends are you with your arson investigator?

 

[858]

Re: OT: Thinking about Short Selling my house...

Unless you're behind and facing foreclosure I don't think the bank will accept the short sale.

 

[ewoaf]

Re: OT: Thinking about Short Selling my house...

go west young man

 

[JRose]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: 858</div><div class="ubbcode-body">Unless you're behind and facing foreclosure I don't think the bank will accept the short sale.

</div></div>

With my loss of income, I called them for a re-structure, they actually advised a SS...

 

[Cartman]

Re: OT: Thinking about Short Selling my house...

I "think" you'll be on the hook to pay taxes on the amount the bank eats as part of the short sale.

 

[shankster..]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: shaggyback</div><div class="ubbcode-body">How good of friends are you with your arson investigator? </div></div>

Don't burn it. Grow it. Pay your large electrical bills. Blame the high energy use on the hot tub, and sell it to the firemen. We know they are stoners anyway. Trickle up economics.

 

[Switchblade]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Phylodog</div><div class="ubbcode-body"> It sucks being part of the 20% in this country who actually give a shit about paying their debts. I lost one of my jobs in November <span style="font-weight: bold">and had to sell a rifle</span>... </div></div>


Ahhhhh, Perish The Thoughts!

Hopefully we will se a bit more upturn in the market in the next few months. Recovery sucks ass but downturns are even worse.

 

[Guest]

Re: OT: Thinking about Short Selling my house...

Space heater left on.

 

[DaveV]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: The Mechanic</div><div class="ubbcode-body">At this point I am paycheck to paycheck.

</div></div>

Pardon my ignorance, but I'm in construction...

what's a paycheck?

 

[Phylodog]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Cartman</div><div class="ubbcode-body">I "think" you'll be on the hook to pay taxes on the amount the bank eats as part of the short sale. </div></div>

Yeah but half of Washington D.C. says you don't actually have to <span style="font-style: italic">pay</span> those. They are merely a suggestion.

 

[jr81452]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: DaveV</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: The Mechanic</div><div class="ubbcode-body">At this point I am paycheck to paycheck.

</div></div>

Pardon my ignorance, but I'm in construction...

what's a paycheck?

</div></div>

it's that slip of paper you used to get; so you could pay your bills.

 

[DaveV]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: jr81452</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: DaveV</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: The Mechanic</div><div class="ubbcode-body">At this point I am paycheck to paycheck.

</div></div>

Pardon my ignorance, but I'm in construction...

what's a paycheck?

</div></div>

it's that slip of paper you used to get; so you could pay your bills. </div></div>

I have a vague recollection of those events...

 

[Maggot]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: tucker301</div><div class="ubbcode-body">

</div></div>

One option.


Don't burn it. Grow it. Pay your large electrical bills. Blame the high energy use on the hot tub, and sell it to the firemen. We know they are stoners anyway. Trickle up economics.

[/quote]

Better option.

Or try talking to whoever has your mortahe. they may already own several SS homes and would rather negotiate away abunch of the interest rather than own another...which they cant selll either. Then if you get the new job mabey you can rent it for at least a neutral cash flow. Its almost always better to work things out than walk away. Yhings are turning around slowly and as QQ said there are a lot of frozen yankees looking soutn....Good Luck.

 

[Lt. Arclight]

Re: OT: Thinking about Short Selling my house...

Damn aluminum wiring.

 

[TacticalSasquach]

Re: OT: Thinking about Short Selling my house...

they dont tax the difference between loan amount vs short sale price anymore bush signed it into law in 2007 but it does expire in 2012, by then you can pick out any vacant house you desire

 

[huntler]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: 858</div><div class="ubbcode-body">Unless you're behind and facing foreclosure I don't think the bank will accept the short sale.

</div></div>

I think this is the case as well.

If it were me. I would move and try to rent the house out. even if it is only half the mortgage, that is still better than all of the mortgage. You will continue to build equity (granted it may still be negative for a few years). I have always done well by weathering the storm.

you may also look into renting it "section 8" for a good size house it pays very well. Not all section 8 renters are monsters, just most.

 

[500grains]

Re: OT: Thinking about Short Selling my house...

The real estate market will continue to slide through 2011. If you can only get 175 now, but the end of next year you may only get 125 or 100.

Short sell NOW and get back on your feet.

 

[shark0311]

Re: OT: Thinking about Short Selling my house...

Short selling does not remove you from the responsibility of paying the balance on your loan. If you are looking at defaulting on your loan I believe that you will have credit issues that will affect you for at least seven years.

My grandparents understood the importance of paying their debt. My grandfather would have just gotten another job to increase his income. He worked every shit job known to man and would juggle two to three at a time. I know that there is plenty of employment opportunities; I hire 2-3 people a week. You may not like the pay or the type of work but if you work multiple jobs you can make it work.

Or just throw in the towel like the rest of society. Character seems to be lacking these days.

You could ask if they would allow you to pay interest only for a year or two or to restructure and use a short term loan vehicle to build up capital. Work hard and pay the difference to the bank.

I'm not giving financial advice just stating an opinion.

 

[BugSniper]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: 500grains</div><div class="ubbcode-body">The real estate market will continue to slide through 2011. If you can only get 175 now, but the end of next year you may only get 125 or 100.

Short sell NOW and get back on your feet. </div></div>


This man speaks the truth. There will be no housing "recovery" because a)It never even fully corrected yet to where it should have been so there is nothing to recover from and b)We are facing rising interest rates which means prices must fall even further as an accomodation before we get hit by inflation(currently hidden by near zero interest). Add on the fact that people can't buy because of the job market and the high default rate and you have one hell of a buyer's market with a time fuse.

If you have money and can ride it through inflation and high interest, buy everything and max yourself to the hilt. If you might lose your job or want to move in the next few years, ditch your house now, not when you "need to."

 

[The Mechanic]

Re: OT: Thinking about Short Selling my house...

I think construction is the only industry hit harder than mine. It has devastated my area that had many construction businesses.<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: DaveV</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: jr81452</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: DaveV</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: The Mechanic</div><div class="ubbcode-body">At this point I am paycheck to paycheck.

</div></div>

Pardon my ignorance, but I'm in construction...

what's a paycheck?

</div></div>

it's that slip of paper you used to get; so you could pay your bills. </div></div>

I have a vague recollection of those events...</div></div>

 

[gunjunkie45]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: DaveV</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: The Mechanic</div><div class="ubbcode-body">At this point I am paycheck to paycheck.

</div></div>

Pardon my ignorance, but I'm in construction...

what's a paycheck?

</div></div>


Hahaha! +1. I'm in the same boat. I've been laid off since June and there aren't any damned construction jobs to be had in this neck of the woods. I took a sales job for a few months to help make ends meet but apparently people don't like buying things from raging assholes such as my self. I just don't have the personality for it. Thankfully it's tax return season and it's looking like things may be picking up in the spring. Good luck to you.

 

[Maggot]

Re: OT: Thinking about Short Selling my house...





but apparently people don't like buying things from raging assholes such as my self. I just don't have the personality for it.

Glad Im not the only one like this....I couldnt sell heaters to eskimos, even with a gov. rebate included...

 

[Two Shoes]

Re: OT: Thinking about Short Selling my house...

Agreed, and depending on the state, you can be sued for the difference in OWED price, v.s. what the bank finally resells it for.....
Could be a WAD.
Our system is screwed.................
A 5 Bllion dollar deal, walked on in NYC?............
Oh, so sorry....here ya go.
And there's no recourse.

Feel for ya bro.............

<span style="font-weight: bold">ONE thing I would not do is BUY another house.............Rent.</span>

People owning homes, or buying............are going/getting screwed...............

Another ( not desirable, but better for you), allow the loan to default, so you can SS.
<span style="font-weight: bold">
Not something I would ever reccommend in normal times........</span>But, now financial institutions are way more lenient, and understanding than ever before.( they are insured thru FDIC).
If you went FHA.................

Like you, never late,missed a pmt in 40yrs.......good men/women, work their tails off, and it makes no sense when 100% scum, get treated better.................

 

[ArcticLight]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: tucker301</div><div class="ubbcode-body">

</div></div>

Was thinking the same thing! I busted a gut when I saw that though!!

They'll catch you if you burn it..

 

[ArcticLight]

Re: OT: Thinking about Short Selling my house...

Seriously though, call your mortgage guy and ask him - tell him he has two choices - they do NOT want your house - they may actually use that new program and bring your house "Above water" - they can write off 20k or 30k to make it sellable..

 

[padronanniversary]

Re: OT: Thinking about Short Selling my house...

Not suggesting this due to your morals, but with a bank, you might want to think like one as well . Businesses pray on their morals, and in a blink of an eye, do what is good for business.

Loan modifications will effect your credit as well, something that the Pres failed to mention. They will note as not paying as agreeed on your credit reports.

The other option although you may not want to even consider it, but strategically foreclose on your house. It will take months for it to foreclose, and the Delta that your house is worth, and maybe worth vs what owe may make it worth it to take the short term hit on your credit. Saving 1 year of mortgage payments is alot of money that can be a nest egg for a new home.

Banks and businesses do it all the time when its business. Nothing personal.

 

[BugSniper]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Two Shoes</div><div class="ubbcode-body">
<span style="font-weight: bold">ONE thing I would not do is BUY another house.............Rent.</span>

People owning homes, or buying............are going/getting screwed...............

</div></div>

Way wrong, but it sounds like you made the wrong choice already and are bitter. People that bought in reasonable times are fine because they agreed on a price that they can afford, period. If you buy something the day before Thanksgiving and see it cheaper on Black Firday... well duh. You were willing to pay, so don't bitch. People that waited, like me, avoided all this crap and are buying when both prices and interest are low. Labor in construction is also low. We will not get screwed unless the market is even sweeter, but that's a ballsy measure. To me, it's sweet enough now.

However, the whole notion that everyone should be able to buy a house is dumb. Most people, as you correctly said, should not buy a house. They do not have the resources, the time, nore the responsibility to have a controlling stake in 200k, 300k, or 600k.

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: PadronAniversary</div><div class="ubbcode-body">The other option although you may not want to even consider it, but strategically foreclose on your house. It will take months for it to foreclose...<snip></div></div>

hahah, months? Dude, your loan, even if you don't pay is evaluated as an asset because, on paper, it is a guarantee for money. If your bank is looking bad already, and most are looking shite, the last thing you want asa banker is to foreclose. Foreclosure is a loss on paper. You know what they're doing instead? No payments, none at all, for 12,18, 24+ months and not so much as a warning to evict. They figure if you live there you might take better care than leaving it abandoned. I kid you not. It's almost MORE ethical as a responsible adult to demand your own payout, really a payback if you make decent coin, for once and just say screw it, I'm not paying.

 

[JRose]

Re: OT: Thinking about Short Selling my house...

I know Short Selling this thing might be the thing to do, but I might just try to suck it up and pay for two places for as long as I can... I hate to ruin my credit...

 

[Rookie]

Re: OT: Thinking about Short Selling my house...

Consider a Deed in leu of forecloser. Basically you are giving the house to the lender before he forecloses. They sell the house, write off the rest as a loss. Hits your credit but saves you mega cash. Consult your local real estate broker.

 

[Ratbert]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: tucker301</div><div class="ubbcode-body">

</div></div>

Don't tempt him. He's a FF, it's like suggesting a recovering alcoholic should start up a basement distillery to make some cash on the side...

 

[Tigerbikes]

Re: OT: Thinking about Short Selling my house...

Jason,

A short sale will not necessarily ruin your credit, it all depends on the deal you cut with the bank.

Is you lender a large institution or a regional/ local bank?

 

[JRose]

Re: OT: Thinking about Short Selling my house...

Jeff,

Bank of America has the loan.

 

[Queequeg]

Re: OT: Thinking about Short Selling my house...

What about setting it up as one of those Voyeur houses and generate reams of cash in the booming internet porn industry?

 

[JRose]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: queequeg</div><div class="ubbcode-body">What about setting it up as one of those Voyeur houses and generate reams of cash in the booming internet porn industry?

</div></div>

Are you kidding?.... This is the bible belt son, we can't even have strippers here!

 

[Maggot]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: JRose</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: queequeg</div><div class="ubbcode-body">What about setting it up as one of those Voyeur houses and generate reams of cash in the booming internet porn industry?

</div></div>

Are you kidding?.... This is the bible belt son, we can't even have strippers here!</div></div>

NO strippers?

Time to go.

 

[eddieo]

Re: OT: Thinking about Short Selling my house...

Any local colleges or hospitals near you /

try renting it to at least cover the mortgage...you may not make anything after bills but at least its still an asset. market wont always be bad..

 

[gunjunkie45]

Re: OT: Thinking about Short Selling my house...

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: JRose</div><div class="ubbcode-body"><div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: queequeg</div><div class="ubbcode-body">What about setting it up as one of those Voyeur houses and generate reams of cash in the booming internet porn industry?

</div></div>

Are you kidding?.... This is the bible belt son, we can't even have strippers here! </div></div>

No strippers!!!!??? Since when? I did basic in Alabama back before moved the chemical and mp schools from Ft. McClellan to Ft Lost in the Woods. I remember going to a strip club on a weekend pass. Half the girls in there would do something extra in the back room for pretty reasonable prices. One of the best strip clubs I've ever been too.

 

[JRose]

Re: OT: Thinking about Short Selling my house...

Not in Baldwin County you didn't....