Bad Credit Agency

My boyfriend is thinking about foreclosing his home, which has been on the market for 1 yr and isn't selling..

He owns 2 other properties and basically pays a lot of money for all 3 of his homes combined. The Florida property has depreciated greatly and right now is appraised for half of what he purchased it for . The home is vacant and was custom built. Renters would only pay at most 1200, when his mortage paym is 3200.00. Should he foreclose the house and get a bad credit report which he thinks can be erased by credit repair agencies? or should he keep paying for this home which is vacant/ He's been paying for a whole year now.....

Public Comments

1. should he keep paying or foreclose? this is gonna ultimately be his decision. is he willing to hold out for two more years?...cause that is about how long this real estate depreciation thing is gonna last. yes, the whole is having the same problems....high payments and property is devalued....unable to refi. many people across the nation took out those ARM loans (adjustable rate mortgage) and now are in deep problems...so he is not alone with this problem. is he able to take on a 2nd job to hang on to these properties for a couple more years? if this is something he is not wanting to do and refi is not an option, then it appears that foreclosure is his only option. when you default on a mortgage....it is not like defaulting on a credit card or other expense. it is actually a deed - not a bill or debt....so the mortgage company does not come after you for payment....when he misses payments (from 1- to 3 depending on the mort. co.) he will be served with a NOD (notice of default). the NOD will clearly state that he has so many days to catch up his missed payments and current payments or the property will enter forclosure. This time line is approximately 90 days from the date the NOD is entered. 90 days and approx. 2 weeks later from the NOD, the trustee will hold a "trustee sale" to sell the property. this sale is usally on the court house steps and is a bidding process. if he has not vacated the propertites by this time, the new owners will evict him. and the eviction will go onto his credit. now - after foreclosures he is not allowed to own property for 24 months (per federal guidelines)...but 24 months after the floreclosure date, if he can get a bank or fin. inst. to fund him, he can again purchase property. again---the most important part of walking away and letting your property go into foreclosure is that they "cannot" come after you for the $$ and cannot garnish your wasges etc....the new owner will now pay the new loan.... here is a website to tell you the exact foreclosure timeline for your state...just click on your state on the left hand side. http://www.realtytrac.com/foreclosure_laws.asp?strState=California good luck
2. There is no credit repair agency anywhere for any amount of money that can erase a foreclosure, it just isn't going to happen. I agree that refinancing is a great option if you can make that happen. Getting some money from tenants is better than nothing, I would explore that option. As long it possible, keep paying. The market will rebound. Savvy investors know this and are picking up properties from desperate sellers and foreclosures.
3. a short sale is the best way he can rid of the property... tell him to call the bank that has his loan and ask for it. Short sale is a agreement between the home owner and the bank, the borrower can't afford the payments any longer and so the bank will agree to your bf to sell the property under whatever he ows... and the bank wont ask for the difference. good luck more questions??? ask me at fnfssandoval@yahoo.com
4. In some areas sellers are doing "short sales" where the seller gets an offer from a buyer for less than he owes on the mortgage. He then takes the offer to the mortgage holder (bank) and asks them to write down the loan to the offer price so it can be sold. The seller walks away with nothing (except clean credit), the bank doesn't have to foreclose (they aren't in business to own real estate), and the buyer gets the house at a fair price. If he can reduce the price enough to get an offer, maybe this scenario will work for him.
5. I agree, a short sell is the way to go. Have the realtor list it for what they can, and have them disclose "subject to short sale agreement with the bank" Talk to the bank first and see what their bottom dollar is.
6. A short sale might be an option, however it also may have some tax consequences or be subject to paying the difference back. Each lending institution has its own rules. He will also have to document his "hardship" to have the short sale approved.