If I forclose on my house.......

[HardHat87]

would thye be able to touch my other money, such as 401k, money market, CD's, etc. Before I get flamed I got a really bad deal on an investment property and this is my last option to get rid of it. I have tried everything else, not to mention dumping assloads of money into it. It won't sell or rent without my taking a huge loss. The housing market in this area keeps declining. What do you think? Any other advice?

Thanks.

 

[HumorMe]

Gasoline would work better.

 

[HardHat87]

Gasoline would work better.

Trust me I have thought of that.

 

[Razorguns]

Doesn't your loan have some sort of mortgage insurance on it, incase you have to foreclose and owe more than it's worth?

As for going after you -- i wouldn't sweat it too much. A mortgage is a "unsecured" loan, where the only security really .. is the home.

 

[Tytan]

can`t touch your other investments, but readily available funds could be claimed.

 

[mhebert4224]

Depends on your state laws. If they forclose on the home and you owe lets say 100,000 and they sell for 70,000. then you are liable for the 30,000 plus all fees. If you can't pay this then they will file a judgment and can garnish wages depending on the state. They can't touch other money unless you file BK. If you take this route I would liq. as many assets into cash as I can. But the laws for BK just changed. Just my 2 cents. Good luck

 

[Razorguns]

What shitty area do you live in where housing prices have dropped??? If you're freaking, then i'm sure you're not hte only one there. Especially in today's era of borrow much, owe much.

 

[HardHat87]

can`t touch your other investments, but readily available funds could be claimed.

readily available meaning savings and money market?

 

[Lestat]

what housing market are you in?

and delete that post saying you thought about comitting insurance fraud. You don't want something like that on the internet.

 

[HardHat87]

Depends on your state laws. If they forclose on the home and you owe lets say 100,000 and they sell for 70,000. then you are liable for the 30,000 plus all fees. If you can't pay this then they will file a judgment and can garnish wages depending on the state. They can't touch other money unless you file BK. If you take this route I would liq. as many assets into cash as I can. But the laws for BK just changed. Just my 2 cents. Good luck

I will have to look into the laws, I don't need to file bankrupcy I just need to get rid of this piece of crap without losing much money. Maybe I will consult a lawyer.

 

[HardHat87]

What shitty area do you live in where housing prices have dropped??? If you're freaking, then i'm sure you're not hte only one there. Especially in today's era of borrow much, owe much.

A slum of Indianapolis

 

[HardHat87]

Ok, i looked at laws for my state and this is what I found:

Judicial: Judicial foreclosure is used in Indiana.

Deficiency: The lender may obtain a deficiency in some case. This may be avoided by the borrower. If the borrower waves the normal foreclosure process that can delay a sale from between three and twelve months, the lender, upon acceptance of the waver, loses the right to a deficiency judgment.

Redemption: There is no right to redemption after the sale.

 

[Razorguns]

Going after you costs them even more money. If they sell the debt to someone else -- they can, but few collection agencies accept. It's hard to argue these cases in civil courts, and present mounds of real estate documentation, most of which are incomprehensible to CA personnel. Most just handle simple credit card stuff anyways.

Most often these loan agencies have insurance to protect against these "falling" neighborhoods and thus modify their loan products for these areas accordingly (higher interest rates, lower limits).

Basically it winds up being the loan companies fault for lending money for a house that was over-valued, and they wind up eating the loss (which get offset by higher rates for newer loans).

Oh, and you'll never get to own a home again -- at least not easily and thru normal means. Foreclosures are frowned upon.

 

[HardHat87]

Going after you costs them even more money. If they sell the debt to someone else -- they can, but few collection agencies accept. It's hard to argue these cases in civil courts, and present mounds of real estate documentation, most of which are incomprehensible to CA personnel. Most just handle simple credit card stuff anyways.

Most often these loan agencies have insurance to protect against these "falling" neighborhoods and thus modify their loan products for these areas accordingly (higher interest rates, lower limits).

Basically it winds up being the loan companies fault for lending money for a house that was over-valued, and they wind up eating the loss (which get offset by higher rates for newer loans).

Oh, and you'll never get to own a home again -- at least not easily and thru normal means. Foreclosures are frowned upon.

Foreclosure is better than a bankrupcy and I know quite a few people who have filed for bankrupcy and after 3-5 years they are able to get the same interest rates that is normal for everyone else. I do have mortage insurance. I don't know, I might talk to a lawyer.

 

[Razorguns]

Foreclosure is better than a bankrupcy and I know quite a few people who have filed for bankrupcy and after 3-5 years they are able to get the same interest rates that is normal for everyone else. I do have mortage insurance. I don't know, I might talk to a lawyer.

Bankruptcy is a weird area. Some creditors like it. Because (1) you can't file again and (2) you are debt-free. Most people afer bankruptcy actually lead good financial lives.

Foreclosure is kinda tough. Only a very competitive cut-throat market where everyone wants your money any way they can(a buyer's market) will get good appreciation with a foreclosure on their record.

Most lenders don't really worry about lending money to high-risk (sub-prime) people. That's not he problem. They just like to use these people to give them higher rate loans with crappier terms. Since they know these people have lesser options.

 

[mhebert4224]

If you can sell the house and have the assets to satisfy the loan then that is the way to go. If you forclose on a home you will not be able to get another Fannie Mae backed loan for a min of 3-4 years. If you file BK then you can get approved after 2 years from discharge of BK. I don't like BK's in my bus. but if you have to do it Ch7 gets in done quicker and less money out. Just make sure you reaffirm all your other debts to keep your credit rating as high as possible.

 

[Tryn2]

Hard to belive you couldnt rent it with a slight loss.....