Need advice re: mortgage

[rainwood]

Fiery -

Your last post was really helpful to understand why you feel obligated to participate in solving the condo dilemma. I doubt your mother wants to be an absentee landlord for the next decade or two so keeping the condo and renting it out is probably not a good option. The condo isn''t saleable at the loan amount so that won''t fix anything. And this isn''t the best place for you or your family to live so staying there for the next few years as things deteriorate further isn''t a good option either. That leaves either a short sale or walking away and letting the lender foreclose. Your mother should definitely talk to someone knowledgeable about her options, but it may make sense to pursue a short sale with the lender and, if needed, consider having you and your mom chip in some money to sweeten the deal for the lender. If that''s at all doable, that may be the best route.

I don''t know what effect a negotiated short sale would have on your mother''s credit. That''s something worth pursuing with someone knowledgeable in both Florida law and how that specific lender reports a short sale to the credit agencies.

I hope you find a good solution. It must be hard knowing your mom was trying to do a good thing for you and got caught in the real estate debacle.

 

[miraclesrule]

the main drawback of a short sell is the taxes that one has to pay as a result. However, the feds have waived the taxes and most states have enacted legislation to forgive that tax as well. It is a tough road to let a property foreclose, but sometimes it does make sense.

I feel for you fiery.

However, if you could lose that property and it doesn''t affect your credit history, it would be a good time to purchase property in the down market.

I know two people who went through this situation in California in 2009. It''s a shame.

 

[Bella_mezzo]

If you can swing it financially, Dreamer and Steel have given excellent advice. I hope you''re able to find a solution to this that you are comfortable with...

best wishes for a New Year where this is all sorted out!!!

 

[Kunzite]

I agree with Dreamer and Steel that the best option would be to look for a renter and deal with the difference until the market rebounds.

So many people are quick to walk away without considering what they''re doing to their neighbors who are staying to stick out their obligation. We didn''t know that we were buying our townhome at the peak of the market either, but we can pay our mortgage so we will live in it until we can sell without taking a hit. With the number of people in our area who are walking away or doing a short sale the comps are very low and thus making our value decrease. So our value is taking a hit because of that. That''s hard to swallow since we''re paying for our obligation but will have to wait longer to sell because others aren''t.

I hope your mom can figure out what she wants to do and that you can find a place that makes you feel safer!

 

[neatfreak]

Fiery, is Florida a recourse state? Something to consider because if by chance it is then the state could go after your mom''s primary residence if they lose $ on her second property because she stops paying.