Your Questions About Foreclosures | foreclosureorder.com

Your Questions About Foreclosures

Your Questions About Foreclosures

Chris asks…

How can we get out of owning this house?

We want out of our house..we’ve owned it for 7 months. We have been having money problems and they want to foreclose the house. What are our options? Bankruptcy? Foreclosure? And what are the consequences of our options?

Your Questions About Foreclosures

The Expert answers:

Foreclosure is not your option – it’s the LENDER’S option if you default on your loan.

Your Questions About Foreclosures

Ken asks…

Can a family let a house go into foreclosure if the house is only titled in the wife’s name, then……?

Here is the story, my wife’s best friend is married. When they purchased their first home her husband’s credit was poor so they received a better interest rate by titling the home in only her name. Now many years later they were forced to relocate and they have found themselves backwards in their mortgage and apparently are unable to sell. I am not certain exactly how much more they owe than the house is worth but I get the feeling that it isn’t more than $20,000 or $30,000. They have rented for nearly a year now and have been paying their mortgage. She called the other day to tell my wife that they got her husband pre-approved for a home loan and they plan to buy a new house in only her husbands name and let the house in her name go into foreclosure. To me, this sounds pretty crazy and I am certain it must come with consequences. They apparently feel like they are going to come out smelling like roses with only her credit being trashed for seven years.

I have my suspicions of what really will happen but I was hoping that an authority might be able to weight in here.

Thanks!
One thing no one has touched on is that if they let their original house go into foreclosure will they be on the hook for whatever the bank loses on the deal? If so is bankruptcy and option for only her, so it wouldn’t affect her husband or their new mortgage?

Your Questions About Foreclosures

The Expert answers:

In a community property state such as California a spouse not on the mortgage must sign a quit claim deed at closing relinquishing all rights to the property, so if she is the only one on the mortgage and title her social security number is the one that will be used in the event of a foreclosure.

This foreclosure will go on her credit report. It would normally take approximately 12-24 months for a lender to consider approving another mortgage for her, under circumstances that she has paid her debts on time and a letter of explanation about the past foreclosure.

Since the husband had to have signed a quitclaim deed prior to the closing of the mortgage that his wife got he can now do as he please in securing another mortgage in his name, since he was not required by law to pay any portion of his wife’s monthly mortgage payments.

The only thing he has to prove is the ability to pay the monthly mortgage payment and have a good credit score. There are a few other things necessary for the approval, but I am sure he will satisfy those requirements to the underwriter;s satisfaction.

The lender will not have a reason nor can they look at the wife’s credit because she will not be on the new mortgage,nor sign a document giving them permission to look at her financial situation. She would have to give the new lender permission for them to look at her credit report, bank accounts, place of employment and other things.

What authority do you want to weigh in on in this situation. The bank qualified a borrower for a mortgage loan, the wife. Now for some reason, that she does not have to disclose, she has decided she no longer want the property or can afford the property. That is her right.

The bank or lender has a recourse to her not paying her monthly mortgage as per their agreement. They now can foreclose on the collateral which is the house.

This is a practice done daily in the United States. I can not see anything that they did wrong as it appears as if the mortgage is now more than the house is worth. This could be a good business decision on the part of the husband and wife. They chose not to continue to pay on a mortgage that is now upside down.

I hope this has been of some use to you, good luck.

“FIGHT ON”

Your Questions About Foreclosures

James asks…

I have an investment property in California, what are the consequences of foreclosure?

I have been searching for information on dealing with the foreclosure of an investment property in california. The house I used to live isn’t worth nearly what I paid for it. I am currently a month ahead in my payments, but am having trouble finding renters and even if I did, it would be at a heavy loss each month. I am looking for information on any tax implications or anything else. Also, the property and mortgage is only in my wife’s name, would this have any effect on my credit score? any help or links to information would be greatly appreciated along with any constructive suggestion. Foreclosure, is not something I want to do, only as a last resort. thank you.
as a bit of extra info. it was originally bought in 12/04 as a primary residence, in which we lived in it until 8/08. when we moved into our current house. Not sure if that changes anything. Does anybody have any links I can go to in order to ensure about paying taxes on “forgiven debt”?
Also one more bit… I am approx 100K upside down on the property at this point.

Your Questions About Foreclosures

The Expert answers:

To do anything you are going to have to get behind in the payments. IF that is something you want to do then do a short sale. How long has it been a rental property? Did you live in it 2 of the last 5 years? See your tax accountant as you will have to adjsut your basis by depreciation etc.

If you say it has been a rental for 7 years my answer would be different.

Why not just put it on the market and sell it and not ruin your credit even if you have to come to the table with 5-10K?

Edited to add
The IRS has stayed the taxation of the shortages in a foreclosure or short sale.

Your Questions About Foreclosures

Sandra asks…

Financial Consequences of Foreclosure – 21 yr/old Graduate Student HELP!?

Good morning all,
I need some major advice. I am a 21y/o MBA student, still searching for a more-tha-customer service job: and 2 yrs ago I purchased a 4br/2bath home in Cenrtal Florida for 175,000. The mortgage is about 1600 per/mo and I have tenants there who are paying 1100 per month. With assoc fee and all, I have to pay out of pocket (about $700) to make up for what the tenants dont pay. I was originally hoping to have that as a long term asset, retirement home, blah. After all expenses, what I save at the end of the month is only 150-200 per month. I still live at home with my mom (widow) and I help her out. I am in the middle of my Master’s program and have to date, about 60,000 in student loans which i will not have to pay until after graduation (i also want to get my PhD, so that ill be done with school either december 09, or 2015 if I go for the Dr). I do not save at the end of the month for a rainy day, a saving, to pay for school, or for a future…here are my questions:

1) since foreclosure records lasts 7 years, would it be reasonable for me to give up my home, and when im 28 look into buying a home again?

2) is it worth it to just continue with this sacrifice? my mother, lil bro and sis all live in a 2br condo, i wanna give my room up to one of the kids and move into a room or sublet elsewhere..

3) the mortgage is joint-tenancy with right of survivorship, so my mom and I are joint owners..would they come after our condo if I foreclose on the house? The condo we llive in is under countrywide, the house is with Chase.

4) I am planning on joining the coast guard to be an ensign officer, liutenant b/c of my education..would a foreclosure affect my ability to enlist?

any other suggestions or feedback would be most appreciated. I can’t offer anyone anything but a thank you, but again, any ideas or suggestions will be highly thanked.

Regards,

cmletamendi@yahoo.com

Your Questions About Foreclosures

The Expert answers:

1) foreclosure is never a good option unless it is to prevent bankruptcy, which is worse. You are not bankrupt though. If you are still saving 200 per month, great. Keep doing that, but put it in an emergency fund for yourself because you will need cash to pay down your loans later or to sell the house if you so choose. Do not make any decisions like that until you are breaking even or losing each month. Also, i suggest that you look at your budget (i can help if you want to email me) and see if there are places you can cut or incomes you can add so that you can make it.

2) you will have to decide that based on what you want to do with the rest of your life. A few years sacrifice is always worth a lifetime of enjoyment

3) yes, if they foreclose you, you will probaby have to pay the difference from what they sell the house for and what you owe. Is there any reason not to move all of you into the house when the lease is up? Would the net result be that you are paying your own mortgage and cutting out the middle man?

4) possibly, but doubtful. They will probably pay for some of your education etiher before or after you enlist. Why not wait on your doctorate until after military service, let uncle sam pay for it. Also, be sure to take your signing bonus and pay down some debt, don’t just blow it. You will have a lot of loan and a lot of house to pay. I would suggest paying down whichever is higher interest, but i would lean toward the loan since it is completely unsecured.

If you have other questions, feel free to email me at tennisbuff2007@yahoo.com

Your Questions About Foreclosures

Carol asks…

I have a 2nd home that I have a 1st and 2nd loan on through different lenders. Consequences of foreclosure?

I am losing almost $1000/month after my renters pay if you count in the 1st & 2nd loan. With the current housing market, I could maybe get enough money to pay the 1st if I sold it. If the 2nd mortgage isn’t covered if I end up foreclosing, what will happen? Am I still responsible for the money? What are the consequences with my credit if I foreclose? I also have my 1st house that I also have NO equity at this point. I also own 1 vehicle. Will the 2nd mortgage company on the foreclosed home come after my 1st home and vehicle? Do I need to file bankruptcy?

Your Questions About Foreclosures

The Expert answers:

First off you know you can’t sell unless you pay both off. You would not be able to give new buyer clear title if the 2nd isn’t paid- Foreclosure will hurt your credit badly- However, I would suggest that over bankruptcy in your case since you own 2 homes. No the 2nd mortgage cannot come after your other home or car. Their security is the home only. You will want to try to keep all your other credit spotless after the foreclosure & eventually you will rebuild.
Good luck!

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Your Questions About Foreclosures
Your Questions About Foreclosures
Your Questions About Foreclosures
Your Questions About Foreclosures
Your Questions About Foreclosures

Your Questions About Foreclosures

Your Questions About Foreclosures