Need advice re: mortgage

[Shoopy]

I posted about this before. In summary: My mom owns the condo we live in, I pay the mortgage. My mom is trying to get rid of the apartment. We have put it up for sale but the current value of the condo is much less than what we currently own on the loan. I have no financial problems paying for the condo.

My mom called yesterday and told me to stop paying the mortgage. I told her I refuse to do that because it will damage her credit. She said that she isn''t worried about it and that if I am concerned about her, I could send her half of the money we pay for the mortgage and save half for us. She said that she can''t get sell it and they won''t give her a loan modification because a) it''s a second property and b) the account is to date.

We are losing thousands and with each payment we lose more. Florida has the homestead exemption that we cannot take advantage of and currently no one is claiming the property taxes because she cannot and since I don''t own, I can''t. We tried to do a deed transfer but it was denied (I''m working on getting the details of this since I wasn''t involved at the time).

I don''t know what to do. My mom is insisting that we stop paying and with the money that we send her she can get a new car that she needs and save the rest. But I can''t bring myself to just stop paying. It doesn''t seem right and I''m really concerned about what would happen if she were to need her credit in the future.

Any thoughts? Anything we haven''t thought of that we could possibly do? Just to give you an idea, the condo was purchased at $180k, we owe $120k, and it is currently valued at $50k

 

[Hudson_Hawk]

First, I''m so sorry you and your family are going through this right now. It''s not an ideal place to be and I commend you on your loyalty to your mom and to doing what''s right for her. That being said, you''re essentially renting the condo from your mother. If she defaults on the mortgage and they foreclose, you and your child are out on the street. Do you have somewhere else you can go if/when this happens? I really think you need to be concerned #1 with your living situation and taking care of the baby, and #2 with your mom''s financial health. I do understand however, that if your mom does serious damage to her financial health, taking care of her down the road could fall on you and your family. Has she talked to a credit counselor or a bankruptcy attorney?

Regardless of how much the condo is worth and what your mortgage is, if you can afford the payments and are OK paying them, then why not just keep paying them? Home ownership is a long term thing, like investments, the value goes up and it goes down. Just because you owe more than it''s worth now doesn''t mean you''ll be in the same boat when the mortgage is paid off in 15-20 years.

Also, have you looked into purchasing the condo from her on your own?

 

[Shoopy]

HH, thanks for the response.

If she were to foreclose, we wouldn't have a problem finding some place else to go.

ETA: Sorry didn't see the other question. She has not spoken to a credit counselor but I can suggest it. My mom has excellent credit as of now and her house is almost paid off.

I'm in the process now of talking to someone to see if I can just purchase for the amount that is owed now and then maybe do a loan modification once it's in my name. I'll be 100% honest and say I have zero idea how this works.

 

[steph72276]

Oh, Fiery...Being a homeowner in FL as well, I totally feel for you. Our property value has done nothing but decrease since we bought our house at the beginning of 2008. But I agree with HH, that if you can easily make the payments, you should probably keep doing so...who knows, the market here in FL is so up and down that it could be worth a lot more next year. Is this a place you would like to live for the next 3-5 years while the market recovers? You said you lose money every month, but you truly haven''t lost anything until you go to sell. By then, it could be worth more than you owe. Good luck!

 

[Loves Vintage]

Fiery,

I remember your prior thread on this topic, and I recall that you do not like living in this condo, and you have some fears about safety issues. Have things improved at all in that regard?

If I were you, I would really hesitate to take on 120k debt on a 50k condo. I would be surprised if the bank would allow you take on the mortgage because it would be like they are issuing a new loan for 120k with insufficient collateral to back it up. I could be wrong, though, of course. We hear about loan modifications on the news, but I don''t know how it actually works in practice, or what banks are really willing to do.

I know the situation in Florida is dismal. We have a condo in the keys, and multiple properties are in foreclosure. The owners stop paying their condo fees and that places an additional burden on the other owners who will have to make up for that loss of contribution to the association.

I am sure most won''t agree, but I would seriously consider walking away. 1. You don''t want to live there and do not feel it is safe. 2. Your mother is willing to take the hit on her credit. It was her investment decision, and it turned out to be a bad one. Who knew that all of this would happen?

On the other hand, if the condo is rentable, and that would cover mortgage and fees, perhaps you could do that. Would it be possible for you guys to live with your mom for a while to help her with finances? This would obviously be the ideal solution, but is it possible?

 

[D&T]

Date: 12/30/2009 9:54:56 AM
Author: fiery
HH, thanks for the response.

If she were to foreclose, we wouldn't have a problem finding some place else to go.

ETA: Sorry didn't see the other question. She has not spoken to a credit counselor but I can suggest it. My mom has excellent credit as of now and her house is almost paid off.

I'm in the process now of talking to someone to see if I can just purchase for the amount that is owed now and then maybe do a loan modification once it's in my name. I'll be 100% honest and say I have zero idea how this works.

Please be very careful of Loan mods. My Mortgage broker friend has refused to do this. Loan mods gives the incentive to the banks to "attempt" to do the loan mods via tax break however its just another way to delay foreclosure. I don't quite know all the details, but he has said that it has not worked for any of his clients

it really just delays foreclosure in the end.


ETA: I was just talking to my boss about excellent credit and for those that are in their later years with their house almost paid off as well as they are in a good position. He mentions to me, and I'm in no way suggesting this but he said that for him, if he had some sort of poor investment and can't do anything constructive that he would just let it go because he no longer needs any credit to buy anything, he's got a good enough savings, retirement, and other investments and his house is almost paid off he's just in a good position in life...So in a nutshell, he doesn't really need his "credit" for anything if that makes sense. However, if for a young person starting out, then you may think twice about unloading poor investments that have negative effects on credit history/score. just something to think about. BTW- my boss is a CPA in a real estate firm. Try to short sale if nothing else first. At least you are making an effort to help reduce liability, if it ends up foreclosed, you've at least Tried.

 

[Loves Vintage]

D&T,

I think that is really excellent advice. It is a very practical way of looking at this situation. In the end, it is an investment. Removing all emotions from the equation, his advice makes a lot of sense.

 

[Hudson_Hawk]

Date: 12/30/2009 10:10:26 AM
Author: D&T

Date: 12/30/2009 9:54:56 AM

Author: fiery

HH, thanks for the response.


If she were to foreclose, we wouldn't have a problem finding some place else to go.


ETA: Sorry didn't see the other question. She has not spoken to a credit counselor but I can suggest it. My mom has excellent credit as of now and her house is almost paid off.


I'm in the process now of talking to someone to see if I can just purchase for the amount that is owed now and then maybe do a loan modification once it's in my name. I'll be 100% honest and say I have zero idea how this works.

Please be very careful of Loan mods. My Mortgage broker friend has refused to do this. Loan mods gives the incentive to the banks to 'attempt' to do the loan mods via tax break however its just another way to delay foreclosure. I don't quite know all the details, but he has said that it has not worked for any of his clients

it really just delays foreclosure in the end.



ETA: I was just talking to my boss about excellent credit and for those that are in their later years with their house almost paid off as well as they are in a good position. He mentions to me, and I'm in no way suggesting this but he said that for him, if he had some sort of poor investment and can't do anything constructive that he would just let it go because he no longer needs any credit to buy anything, he's got a good enough savings, retirement, and other investments and his house is almost paid off he's just in a good position in life...So in a nutshell, he doesn't really need his 'credit' for anything if that makes sense. However, if for a young person starting out, then you may think twice about unloading poor investments that have negative effects on credit history/score. just something to think about. BTW- my boss is a CPA in a real estate firm. Try to short sale if nothing else first. At least you are making an effort to help reduce liability, if it ends up foreclosed, you've at least Tried.

Just for additional background, DH and I went through almost two years of attempted loan modifications. They'd try and set one up, something would go wrong (claimed they didn't have paperwork, etc) they'd close the case, then they'd reopen the case, re-enroll us in the program, up our payments by $200/month and then have a similar issue and close the case. They did this for two years until our monthly payments were too much for us to afford (went from around $1200/month to $2200/month in the end) and we had to walk away and let them foreclose.

ETA: We thought we were doing something wrong (re the paperwork and "issues" they were having) but after researching the company we discovered that this was their M.O. and they had a lousy track record of successfully modifying loans.

 

[Shoopy]

LV-In terms of safety and just wanting to get out, no it hasn''t improved but we''re fine with sucking it up for the time being. I feel exactly as you described. If I''m going to take out a $120k loan, I would much rather do so for a bigger/safer/nicer place and not for one that is worth $50k. It just doesn''t make sense. The condo *may* be rentable but definitely not enough to cover everything. The property is a condo conversion and because the developers could not sell anymore, it has gone back to being primarily a rental place. The same apartment is going for $700. Our mortgage is $1,030 (including $300 taxes) and the association fees are $250.

D&T-That''s how my mom feels about it. To me, she''s still way young (only 53) but she feels that she doesn''t need her credit for anything anymore. Her primary home is the one she will live in (i.e. she has no plans on moving anywhere else). She has a 401k, IRA, and a couple of other investments. She also has some money saved up. I keep thinking to myself though what would happen if she needed a loan to cover health bills or something? FI mentioned that if that were ever the case, I could just add her to my health insurance or we could take out the loan in our name and we know she would be able to pay for it but it just doesn''t feel right. My mom is hoping that if we stop paying, she could do a short sale. She spoke with a realtor this morning who told her that because we are paying to date and because I live there, they wouldn''t be able to do anything. He mentioned having to put my income down on the documents and because of that we wouldn''t qualify. This doesn''t make sense to me since we don''t have a lease agreement but again I don''t know much.

 

[Hudson_Hawk]

You need to speak to a financial/mortgage expert, not a realtor.

 

[Shoopy]

Date: 12/30/2009 10:54:47 AM
Author: Hudson_Hawk
You need to speak to a financial/mortgage expert, not a realtor.

That''s the advice she was given by the realtor and she is going to meet with one this week. I''ve asked her to see if she could reschedule so that I could be there and get educated myself.

 

[D&T]

Date: 12/30/2009 10:48:09 AM
Author: fiery
LV-In terms of safety and just wanting to get out, no it hasn't improved but we're fine with sucking it up for the time being. I feel exactly as you described. If I'm going to take out a $120k loan, I would much rather do so for a bigger/safer/nicer place and not for one that is worth $50k. It just doesn't make sense. The condo *may* be rentable but definitely not enough to cover everything. The property is a condo conversion and because the developers could not sell anymore, it has gone back to being primarily a rental place. The same apartment is going for $700. Our mortgage is $1,030 (including $300 taxes) and the association fees are $250.

D&T-That's how my mom feels about it. To me, she's still way young (only 53) but she feels that she doesn't need her credit for anything anymore. Her primary home is the one she will live in (i.e. she has no plans on moving anywhere else). She has a 401k, IRA, and a couple of other investments. She also has some money saved up. I keep thinking to myself though what would happen if she needed a loan to cover health bills or something? FI mentioned that if that were ever the case, I could just add her to my health insurance or we could take out the loan in our name and we know she would be able to pay for it but it just doesn't feel right. My mom is hoping that if we stop paying, she could do a short sale. She spoke with a realtor this morning who told her that because we are paying to date and because I live there, they wouldn't be able to do anything. He mentioned having to put my income down on the documents and because of that we wouldn't qualify. This doesn't make sense to me since we don't have a lease agreement but again I don't know much.

-List the property at the amount your mom owes so you can cover your full loan *IF* you get an offer for the amount...doubt it but incase, you are under contract to sell at list price, but you don't want to list under what your loan is and get screwed becuase the bank has not agreed to short sale and now you are under *contractual* agreement. (this was how it was a few years ago in order to initiate a short sale- process may have changed since then due to the massive amount of inventory now) but you could possibly just walk right into a short sale listing- best to contact the bank and ask for the process on short sale.
-stop making payments
-then after 30 days has passed after the first missed payment contact the bank and discuss short sale, stating that market value and what is owed is short
-Bank/note holder will send out appraiser
-Once the appraiser gives the figures to the bank then there will be an "approved" short sale price
-Realtor then will list the amount "approved" subtject to third party approval
-wait wait wait, if no offer or short offer, bank can approve or just sit on in it which then foreclosure process can start. Depending on how long it takes for the bank to get their act together, Foreclosure period can range, 12 months was the longest that I have had experience with. Your mom will get a 1099 for the deficiency of the short sale if it goes through or foreclosure she will get for the value of the loan. You will then need a tax person to help with this comes tax time for The Mortgage Forgiveness Debt Relief Act and Debt Cancellation .
Hope this somewhat helps. Get a short sale Realtor expert otherwise get as much information from the bank on the process.

ETA: you may have to move out for a short sale to help show a reduction of income from no rental if they are requiring you to document your income on your mom's part?... you don't have a lease agreement, and I don't know why they would ask a tenant to provide such information?

I had a property with tenants, did a short sale, and did not require that information. They would require financials on your mom though.

 

[DivaDiamond007]

Date: 12/30/2009 10:10:26 AM
Author: Loves Vintage
Fiery,

I remember your prior thread on this topic, and I recall that you do not like living in this condo, and you have some fears about safety issues. Have things improved at all in that regard?

If I were you, I would really hesitate to take on 120k debt on a 50k condo. I would be surprised if the bank would allow you take on the mortgage because it would be like they are issuing a new loan for 120k with insufficient collateral to back it up. I could be wrong, though, of course. We hear about loan modifications on the news, but I don''t know how it actually works in practice, or what banks are really willing to do.

I know the situation in Florida is dismal. We have a condo in the keys, and multiple properties are in foreclosure. The owners stop paying their condo fees and that places an additional burden on the other owners who will have to make up for that loss of contribution to the association.

I am sure most won''t agree, but I would seriously consider walking away. 1. You don''t want to live there and do not feel it is safe. 2. Your mother is willing to take the hit on her credit. It was her investment decision, and it turned out to be a bad one. Who knew that all of this would happen?

On the other hand, if the condo is rentable, and that would cover mortgage and fees, perhaps you could do that. Would it be possible for you guys to live with your mom for a while to help her with finances? This would obviously be the ideal solution, but is it possible?

I agree with this. You and your DH do not own the condo and you are not (legally) responsible to pay the mortgage. Your mother is the only one responsible for the property, and if she wants to default on the mortgage then that''s her choice to make. She is only 53 and her credit will be damaged by not making payments, but it will recover in due time in the event she wants to finance a car or other real estate in the future.

Honestly, the condo sounds like it was nothing more than a bad investment. If your mom cannot afford the payments and wishes to surrender the property she should consult a reputable bankruptcy attorney and take a look at her legal options.

 

[Shoopy]

Thank you ladies, for the great advice. It has helped me out a lot.

D&T-Thanks for posting those suggestions. I''ll follow up once we decide what we should do.

 

[fleur-de-lis]

Date: 12/30/2009 9:36:35 AM
Author:fiery


I don't know what to do. My mom is insisting that we stop paying and with the money that we send her she can get a new car that she needs and save the rest. But I can't bring myself to just stop paying. It doesn't seem right and I'm really concerned about what would happen if she were to need her credit in the future.


Any thoughts? Anything we haven't thought of that we could possibly do? Just to give you an idea, the condo was purchased at $180k, we owe $120k, and it is currently valued at $50k

In a nutshell, your mom not only wants the bank to eat the $70,000 loss that should be hers BUT ALSO essentially defraud the bank by going deadbeat for a few months so she can hide and hoard enough tenant money to buy herself a new car????

That second part no longer makes this just about loan mods or assumptions. No wonder why you don't think this seems right. I'm so sorry, Fiery, this must be a very hard thing for you to witness.

 

[Bella_mezzo]

Fiery, I''m sorry you are going through this!

Definitely talk to a financial expert. Your mom is awfully young to not care about her credit score any more. 53 is not the same as say 83 IMO. I know you aren''t thrilled with it, but what is your mom''s urgency to sell now? Is it so that you and your DH can buy something?

If so, maybe the best thing is for you to move out, your mom to try and arrange a short sale, and go from there to see if that can be arranged. If not she can pursue foreclosure however she wants, but you don''t have to be involved in any way .

But, really your mom should consult a good, well-recommended financial advisor.

I would not do a loan mod on this property, it''s just not worth it IMO.

 

[smitcompton]

Hi Fiery,
I don''t want to throw more bad news at you but i had a similar problem with a condo I owned. But, I live in Il.
I had a primary residence and rented out a condo I owned that was bought as an investment property. I became Ill and couldn''t deal with the condo anymore( I moved to England to be near family). I had owned it 9 yrs. It was a bad market at that time as well, not as bad as now, but condos weren''t selling easily. I asked the bank to take back the condo as something called " a sale in lieu" where I just give them the keys.

They replied by telling me they would put a lien on my house to collect the rest of the morgage that was owed to them. i was in shock. Others had said that the bank would take it back, I did put the condo on the market, but they wanted their money no matter what. I did a quit claim deed of my house to my brother so they couldn''t touch my house and I let them foreclose. They sold the condo for more than the morgage one month after foreclosure. I was left with the foreclosure bill on my credit. (attorneys fees)

I think you should talk to an attorney to make sure they can''t come after your mother''s house. I don''t know Florida law but I''d check. After all it is an investment property.

I don''t have any advise except talk to a real estate attorney or search on line for the info.

Thanks,
Annette

 

[Haven]

Your mother is asking you to do something that you find to be unethical. If I were you, I would tell her that you are uncomfortable living in a home and not paying the mortgage.
Then, I would move out and find another place to live.
The condo is your mother''s responsibility, and if she wants to refrain from paying the mortgage that she owes, fine. But I wouldn''t allow her to compromise my own morals.

This is a tough situation, so sorry that you find yourself stuck in the middle of it.

 

[MichelleCarmen]

Date: 12/30/2009 2:50:14 PM
Author: Haven
Your mother is asking you to do something that you find to be unethical. If I were you, I would tell her that you are uncomfortable living in a home and not paying the mortgage.
Then, I would move out and find another place to live.
The condo is your mother''s responsibility, and if she wants to refrain from paying the mortgage that she owes, fine. But I wouldn''t allow her to compromise my own morals.

This is a tough situation, so sorry that you find yourself stuck in the middle of it.

2nd to Haven''s comments.

 

[crown1]

Date: 12/30/2009 2:50:14 PM
Author: Haven
Your mother is asking you to do something that you find to be unethical. If I were you, I would tell her that you are uncomfortable living in a home and not paying the mortgage.

Then, I would move out and find another place to live.

The condo is your mother''s responsibility, and if she wants to refrain from paying the mortgage that she owes, fine. But I wouldn''t allow her to compromise my own morals.


This is a tough situation, so sorry that you find yourself stuck in the middle of it.

good advice.

 

[Shoopy]

Thank you everyone for the additional input.

I hope I didn''t give the impression that my mother is this type of person regularly.

The main problem here is that we are both uneducated and she is getting her advice from people that have no problem doing these things. For example, one of the owners in our community talked to her while she was here. They stopped paying the mortgage 2 years ago. The condo just went into foreclosure and they are just now being asked to leave. But in those 2 years they managed to save $25k. My mom heard this and immediately thought downpayment for a house for us.

From her POV, while she knows that we can continue paying for it she also knows that the living condition has gotten worse over the years and with DD we have zero space (it''s 900sqft). She feels badly and wants us to get into a house so that we have more space.

From my POV, there is no way I can do this to her. She made a bad investment, that happens all the time. I''m not going to continue to let her get screwed, KWIM?

 

[Dreamer_D]

Date: 12/30/2009 2:50:14 PM
Author: Haven
Your mother is asking you to do something that you find to be unethical. If I were you, I would tell her that you are uncomfortable living in a home and not paying the mortgage.
Then, I would move out and find another place to live.
The condo is your mother''s responsibility, and if she wants to refrain from paying the mortgage that she owes, fine. But I wouldn''t allow her to compromise my own morals.

This is a tough situation, so sorry that you find yourself stuck in the middle of it.

Yes, this is what I think too.

Fiery, I know how it feels to want to help and look after your mom. And I think you should, within reason. I do not think that you should be overpaying in rent to help her out, though. It is throwing good money after bad and getting your wrapped up in thing. I feel bad that she is putting you in this position, honetly. She is the mom.

I wonder if she is even elligible for bankruptcy etc. she has assets in terms of her own home, they could go after that couldn''t they?

 

[fleur-de-lis]

Date: 12/30/2009 3:35:56 PM
Author: fiery
Thank you everyone for the additional input.


I hope I didn''t give the impression that my mother is this type of person regularly.

Fiery, based on your posts here, (1) you''re a lovely person and (2) you''re close to your mom. Put those two together and it''s pretty obvious that your mother isn''t "this type of person regularly." Really.

I hope it''s okay to speak bluntly, but in the end someone is going to get left holding the bag:
--In Option 1, you keep paying $1200/mo for an apartment whose market rent is $700/month or in lieu of you yourself buying one of those $50K units for a mere $400/month mortgage (or something completely unrelated to this property). This is your mom harming you to benefit her.
--In Option 2, your mom stops paying the bank, only asks you to give her going rate, and she uses that to buy a new car while also sticking the bank with a 70K loss, PLUS a year of lost payments, PLUS thousands of dollars in legal costs. That is your mom harming the bank to benefit her.
--In Option 3, your mom stops expecting other people to bear the costs of her mistakes AS WELL AS trying to devise ways to benefit herself more as long as she''s being morally bankrupt. Your mom takes responsibility for her decisions. She meets with a lawyer/financial planner to plot an optimal course of action which is consistent with Florida law and the protections of recently passed federal guidelines. She releases you from these unfavorable terms on a unit which you don''t like so that you aren''t being embroiled in the moral depravity. Your mom takes the heat for her prior decisions and risks.

Fiery, this is clearly a tough time for your mother. It is all too easy to listen to the voices telling her how "easy" it is to defraud at this time. FWIW-- and perhaps PerfectPear will be by shortly to share her experiences-- but at least in some states (like CA), the damage done by facing the music in Option 3 is tough, but not catastrophic. In many states (but I''m not sure about FL law on recourse loans, likelihood of deficiency judgments in the current environment, nor FL bankruptcy exclusions and protections, so that''s why in Option 3 I mention your mom meeting with a FL atty. before acting because it''s state-specific), your mom keeps her primary residence, doesn''t claim bankruptcy, and takes a 100-150 point hit on her credit.

Fiery, so far your mother hasn''t "gotten screwed". Not one bit. She has an over-market paying renter keeping her from getting the lowered credit score she should actually have, she didn''t do her due diligence when she bought the condo at the tippy-top of the market for $180K, and she hasn''t had to face the pain of her decision one bit yet as of today. But at some point she''s going to have to face the music. The only thing that remains is if she''s going to try and throw some other people or entities under the bus first to lessen its impact on her. The temptation will be there; it is already.

Is it okay if I send you well-wishes? Cause this stuff is obviously tough from an emotional perspective no matter what. Be good to yourself.

 

[Steel]

I am sorry your Mother is in a pickle. She must be very stressed.

Did you mention how much you are paying in comparision to renting? Is it costing you more to pay her mortgage and stay in her condo than rent somewhere preferable?

 

[Shoopy]

Date: 12/30/2009 5:53:07 PM
Author: Steel
I am sorry your Mother is in a pickle. She must be very stressed.

Did you mention how much you are paying in comparision to renting? Is it costing you more to pay her mortgage and stay in her condo than rent somewhere preferable?

Yes it does cost more to pay the mortgage than living somewhere comparable. The mortgage itself is $700 with $300 in taxes because the property taxes are very high.

When my mom first purchased, she was looking to invest her money in a property. At the same time, I was looking for a place to live after graduating college. I didn''t have the type of credit (or money really since I had just graduated from school) to own a place but had no problem renting. My mom decided to purchase a condo here in SFL (she lives in Central FL). This was right before the crash and at a time where owning made a lot more sense than renting. The intention was for me to decide what to do with the place--live in it for a few years before moving to a house, stay living there forever (obviously not), or when I was ready to move hand over the place to my brothers if they wanted to live there. At the time, people were also flipping and making a profit so it made sense to us that this would be a good investment. We had no idea this was going to happen. Also at the time I had no intention of having a baby any time soon and was making $30k less than what I am making now.

Things happen, you know? It''s not a situation where she invested with the hopes that I would pay for her mortgage and she would come out ahead. Yes, it is technically her mortgage because her name is on the property but it is a place that was purchased for me because at the time I couldn''t purchase. This is why I have a real hard time walking away from it.

 

[Italiahaircolor]

You''re by far not the only one stuck in this situation...but bailing on your mortgage isn''t your only option...

I would try to work out a short sale with your bank. Sure it''s harder than just walking away, but it''s better in the long run. Sure your mom feels that she doesn''t "need" her credit anymore, but you just never know whats around the next bend in life and knowingly burning herself might not be in her best interest. Walking away is a quick fix, but the lasting effects might be really damaging.

 

[AmberGretchen]

Date: 12/30/2009 2:50:14 PM
Author: Haven
Your mother is asking you to do something that you find to be unethical. If I were you, I would tell her that you are uncomfortable living in a home and not paying the mortgage.

Then, I would move out and find another place to live.

The condo is your mother''s responsibility, and if she wants to refrain from paying the mortgage that she owes, fine. But I wouldn''t allow her to compromise my own morals.


This is a tough situation, so sorry that you find yourself stuck in the middle of it.

Also ditto to Haven. The whole thing sounds a bit fishy and unethical, and I think the best thing you can do is remove yourself and your family from the equation so it can be a clean thing on your mom''s credit (i.e. she can deal with the consequences of her decision on her own), and you can do what you feel is right. You don''t want this to come back and bite you in the butt later.

This is not to say you can''t help your mom out, but I think that doing it the way she''s suggesting will only lead to tension and bad things for you and for your relationship with her.

 

[Steel]

Thanks for the extra info Fiery.

Those taxes are a kick in the a$$

.

Are there lots of vacant apartments in the area? How low would you have to drop the rent to get a tennant in? Say if you could get somebody in for $700p/m would you want to write off the taxes yourself? In the hope that the property value would rise against your (mother's) negative equity to the point where you (she) could sell with less if not no loss.

The only real benefit is that you get to move out to somewhere more suitable but you still take a hit of some $$$p/m.

I assume your mother has no wish to live there and sell her principle residence?

ETA: about those taxes. Can you reassess the property tax based on the current value and negative equity.

 

[Dreamer_D]

I thought of another idea. The best solution is to keep the property until it rides the wave and gains value again, perhaps in 10-15 years. But you personally shouldn''t be pouring more money into it.

What if you move out and buy your own place since prices are so low. Then the mortgage you are paying there is good money spent. Then you rent the appartment you are living in to some stranger and let them pay 700 plus utilities. This leaves you with only 300 per month in carrying costs out of your own pocket, plus maintenance fees which are not too high for a condo. In 10 years when the price of the home goes up, then the 300 per month is good money that you personally have spent. Look at it as a long term investment. The $700 from the renter may be bad money spent, but who cares?

That is what I think I would try to do in your situation. If your mom cannot afford the $300, then as her daughter I might talk about paying half to help her out, perhaps as an investment in part ownership down the road.

What do you think?

 

[Dreamer_D]

Date: 12/31/2009 1:36:03 PM
Author: Steel
Thanks for the extra info Fiery.

Those taxes are a kick in the a$$

.

Are there lots of vacant apartments in the area? How low would you have to drop the rent to get a tennant in? Say if you could get somebody in for $700p/m would you want to write off the taxes yourself? In the hope that the property value would rise against your (mother''s) negative equity to the point where you (she) could sell with less if not no loss.

The only real benefit is that you get to move out to somewhere more suitable but you still take a hit of some $$$p/m.

I assume your mother has no wish to live there and sell her principle residence?

ETA: about those taxes. Can you reassess the property tax based on the current value and negative equity.

haha.. I didn''t read this before I posted. I had the exact same idea.