I can make the payments but I feel trapped because I know I can get so much more house for the money I paid for this one. Even if the Economy turns around it will take longer where I am at. Plus my wife and I might split up and depending on what the courts decide would determine who gets the house. If I stay I could afford it but if she stays and I have to find another place then we would have to sell.

Flag content

February 06 2009

Eurotextil
Contributions: 5

Eurotextil

Contributions: 5

Q&A

:4
Disc

:1

View full profile

I would advise to sell if you find a buyer. Wife no wife , courts no courst stage the house and sell it. Try to have the wife participate, It better to have no debt ( maintain a good Fico ) and rent. There will be others houses out there to buy and with a stable FICO you will be able to buy that Man Cave you may need,

Flag content

February 06 2009

wetdawgs
Contributions: 5057

wetdawgs

Contributions: 5057

Q&A

:3320
Disc

:1731
Photos

:6

Zillow All-Star

Since January 2009

View full profile

"I can get so much more house for the money I paid for this one." The trick is that you can't it you follow the options you've proposed. If you have foreclosed, or short sale, you are not able to buy that "so much more house" until some years have passed because it will impact your credit score and will be on your record.

Yes, indeed, it doesn't feel good to be underwater. But, when you bought the house there was no guarantee it would go up.

At this stage, if partnership is falling apart, work with your bank to put it on the market as a short sale IF you qualify.

Flag content

February 06 2009

Connie Wildasinn, "Connie Wildasin"
Contributions: 942

Connie Wildasinn, "Connie Wildasin"

Real Estate Agent

View my 6 listings

Contributions: 942

Q&A

:515
Disc

:196
Photos

:231

Zillow All-Star

Since January 2010

View full profile

short sale if you can ... it will look better on your record than a foreclosure... good luck

Flag content

February 07 2009

Fernando Herboso, "RealtorMaryland"
Contributions: 45

Fernando Herboso, "RealtorMaryland"

Real Estate Agent

View my 4 listings

Contributions: 45

Q&A

:3
Disc

:3
Photos

:39

View full profile

[content removed by moderator for being self promotional]

Flag content

February 07 2009

S A, "GaDealMakers"
Contributions: 4

S A, "GaDealMakers"

Real Estate Agent

Contributions: 4

Q&A

:3
Disc

:1

View full profile

You haven't split up yet. So it's speculative now. Other options you can consider is having your home lease purchased or owner financed by a buyer. I think owner financing will be real popular with people unable to get home loans.

Look at all your options before considering foreclosure. Also talk with your lenders. Most of them are very flexible now and there might be other options they can propose to you like a short sale. Look at everything before settling for the easy way out. Hope this helps and good luck to you.

Flag content

February 15 2009

Paul Argueta, "paulargueta"
Contributions: 1124

Paul Argueta, "paulargueta"

Highland Park

Real Estate Agent

View my 37 listings

Contributions: 1124

Q&A

:11
Disc

:1
Photos

:1112

Zillow All-Star

Since December 2009

View full profile

You might want to consider a deed in lieu of foreclosure and just hand over the keys. It will still affect your credit, but it will avoid the foreclosure. If that doesn't interest you go for a short sale. This cycle is gonna take a while to turn around and I wouldn't be banking on MAKING ANY DECISIONS on an upside down property based on the market turning around any time soon.

Flag content

February 17 2009

sunnyview
Contributions: 12572

sunnyview

Contributions: 12572

Q&A

:7756
Disc

:4789
Photos

:27

Zillow All-Star

Since January 2009

View full profile

You might want to check this link about deficiency judgements in AZ. It looks like they have them so you would benefit from reducing the amount that will still be owed to the bank by possibly a short sale. Please do a little research before you decide what to do.

Flag content

February 17 2009

Alejandro Cruz, CDPE, "AlexCruzRealtor"
Contributions: 47

Alejandro Cruz, CDPE, "AlexCruzRealtor"

Real Estate Agent

View my 3 listings

Contributions: 47

Q&A

:22
Disc

:3
Photos

:22

View full profile

A divorce is a legitimate financial hardship. You can do a short sale. You should never walk away. Foreclosure should not be an option. If the home is worth less, you can grieve your property taxes, If your interest is high, refinance.

Flag content

February 17 2009

Roberto Ribas, "azrob"
Contributions: 8697

Roberto Ribas, "azrob"

Real Estate Agent

View my 1 listings

Contributions: 8697

Q&A

:1258
Disc

:7299
Photos

:140

Zillow All-Star

Since January 2009

View full profile

you can't refinance so easily if you are upside down.

I love all the advice on here, from people who don't have a clue. In many neighborhoods here in Phoenix, prices are closing in on down 60 to 75 percent.

A buyer could easily have bought a home near 300K in 2006, to be seeing similar models sell for 80K today, in some zips. That owner will be trapped by the upside down home for 20 or 30 years quite likely. How long does bad credit last again? how long after foreclosure till you can buy again? you do the math!

Flag content

February 17 2009

The Leonardo Team
Contributions: 1138

The Leonardo Team

Palm Springs

Real Estate Agent

View my 36 listings

Contributions: 1138

Q&A

:105
Disc

:111
Photos

:922

View full profile

Oynotc,

Short sale is the way to go. Let me know if you need additional info on short sales. I have been on both sides of the transaction and am very familiar with it. Cheers

Leonardo

Flag content

February 17 2009

Kristen Blanchet, "Massachusetts Broker"
Contributions: 479

Kristen Blanchet, "Massachusetts Broker"

Real Estate Agent

View my 18 listings

Contributions: 479

Q&A

:185
Disc

:13
Photos

:281

Zillow All-Star

Since February 2010

View full profile

NO! Don't let it foreclose if you can sell it out right or as a short sale!!!!! It is only beneficial for you to do it either of the other ways! Let me know if you need an experienced agent in your area to help you....I do short sales all the time and they may be time consuming but, don't affect your credit like a foreclosure will...

Flag content

February 17 2009

Muzique Food4YoSoul, "Mrero1971"
Contributions: 2

Muzique Food4YoSoul, "Mrero1971"

Contributions: 2

Disc

:2

View full profile

I second Kristen's comments. I currently live in a home that I recently purchased through a short sale. I'll be honest with you, it was somewhat of a painful situation, for both the sellers as well as for my wife and I. The process took 4 months (short 3 days),&some people say that was quick. It was very frustrating for us as buyers and I hear for the sellers as well. As we look back, we still say that it was worth it. One advice I have for those interested in selling their house short. MAKE SURE YOU GET AN AGENT WHO's KNOWLEDGEABLE ABOUT SHORT SALES. Get an overview of the process & a milestone based timeline. Get a list of all documents you may need to submit. Because the process can take a long time to complete, REQUEST FEEDBACK FREQUENTLY (OR HAVE YOUR AGENT DO THAT) FROM WHOEVER HAS "THE BALL" TO MAKE SURE THAT EVERYONE IS STAYING ON TASK. ok, I've said enough.

Flag content

February 17 2009

BITLLC
Contributions: 37

BITLLC

Real Estate Agent

Contributions: 37

Q&A

:34
Disc

:3

View full profile

So, suppose you attained a house worth $200,000. You put $50,000 down and you had a mortgage of $150,000 on the house, and now the house is only worth $150,000.

Well suppose it is worth exactly how much you owe, or maybe it's even worth a lot less. If it's worth $145,000, and you owe $150,000. The question is, well, if I walk away from the house, I have walked away from my $50,000 investment.

But then, when you think about it, if you stay in the house, you are staying in a house that is worth far less than it was when you bought it, so you are still out the $50,000 investment. Question is what can you do in this situation?
So, that's one possibility. You could stay in the house, as long as you could afford to catch up on your risk up on the monthly payments, and make those monthly payments on a regular basis resulting in you remaining in the house.

Flag content

February 19 2009

BITLLC
Contributions: 37

BITLLC

Real Estate Agent

Contributions: 37

Q&A

:34
Disc

:3

View full profile

In other words, one way to win if you are in a house where the value has diminished so greatly that it is now worth less than the mortgage on it, is just hang tight. Hold on, yeah that's right HOLD ON.

It's going to be a hard ride, but hold on. Don't cut and run, hold on. Don't pack it in, hold on.

Don't give up, don't quit, hold on, because as the market went down, the market can come up and most economists and real estate investors believe that once we get a few months, maybe a couple of years behind us, we will be over this economic crisis, and most of the real estate markets will come back.

Victoria

[content removed by moderator for being self promotional]

Flag content

February 19 2009

Roberto Ribas, "azrob"
Contributions: 8697

Roberto Ribas, "azrob"

Real Estate Agent

View my 1 listings

Contributions: 8697

Q&A

:1258
Disc

:7299
Photos

:140

Zillow All-Star

Since January 2009

View full profile

I don't know very many economists who think this will be over in "'a couple of months, a couple of years..." I know alot of realtors who know/pray this!

But then again, I'm a professor of mathematics, my area of study was math applied to econometrics... That might explain the difference!

Your examples are foolish; sure, if the poster is only 5k upside down, walking away doesn't make sense. What if the home was bought for 300k, zero down, and is now worht 150K? if homes suddenly started going up at 5% a year, it would take about 15 years to get back to zero.... (show of hands, who thinks homes will be worht 5% more next year? nobody rational? ok... so more than 15 years!)

how long after a foreclosure till someone can buy a home again? certainly not 15 years! so who would come out ahead in the long run?

Flag content

February 19 2009

elldee
Contributions: 119

elldee

Contributions: 119

Q&A

:54
Disc

:65

View full profile

Self-serving real estate agents come in all shapes, sizes, ages and looks... and my brother thinks blondes are dumb! You're a drive-by to take the drive-by prize, SolutionsAgent. Two days on Zillow&you're already a "blue ribbon" poster, LOL. How'd you manage that one, give yourself a bunch of thumbs up? Or maybe the guys on Zillow are rating you on your looks. What in the world was that first post supposed to mean? If his house was worth $200K w/a $50K down payment, and now it's worth $150K or less, all it means is that he's lost at least $50K, period. It's gone.And the 2nd one is simply absurd. You sure feel confident in going into threads here and telling people with aplomb exactly what they should do, don't you? "Most economists" believe.... ?!? no, they don't. Where do you get your "facts"? If you can get out with a sale or short sale, oynotc, do it as quickly as possible, because each month that passes the chances you'll sell it go down.

Flag content

February 22 2009

Fernando Herboso, "RealtorMaryland"
Contributions: 45

Fernando Herboso, "RealtorMaryland"

Real Estate Agent

View my 4 listings

Contributions: 45

Q&A

:3
Disc

:3
Photos

:39

View full profile

My advice is for you to try a loan modification first.It that fails, obvioulsy a short sale should your next step.
One caveat
You can not Â apply for a short sale just because your house isn't worh as much as you owe to the bank. . you have to have a legitimate hardship
I want to invite to my website and download my frre eBook " Is a Short Sale An Option For Me"

[content removed by moderator for being self promotional]

Flag content

February 23 2009

Lauri Ann Maloney, "Lauri Ann Maloney"
Contributions: 59

Lauri Ann Maloney, "Lauri Ann Maloney"

Real Estate Agent

View my 3 listings

Contributions: 59

Q&A

:6
Disc

:11
Photos

:42

View full profile

Talk to your lender! They may be able to help. Sometimes they will rework your mortgage so you can have a better payment.

Check into a short sale. In a short sale you are selling the house for less than it is worth and the bank may need to take a loss. The difference between what you owe and what you can sell the home for may end up as an outstanding debt to you. The bank may require you to pay that back. Be sure you know what will occur with the deficiency! Will the bank forgive it or will they require you to pay it back?

You cannot go out and get another house right away if you foreclose. You mentioned that you could get so much more house for the money. Most banks require at LEAST 2 years after a foreclosure before you can purchase another home.

Flag content

February 24 2009

Tom Ashworth, "tomashworth"
Contributions: 186

Tom Ashworth, "tomashworth"

Real Estate Agent

View my 3 listings

Contributions: 186

Q&A

:130
Disc

:33
Photos

:23

View full profile

Options are available. I would talk to your lender, talk with a REALTOR about a possible short sale. Also have you sold things to try and pay your mortgage. I think you should check out Davy Ramsey - Total Money Makeover

Flag content

February 24 2009

Kathy Toth, "AnnArborRealEstate"
Contributions: 831

Kathy Toth, "AnnArborRealEstate"

Ann Arbor, MI

Real Estate Agent

View my 38 listings

Contributions: 831

Q&A

:12
Disc

:7
Photos

:812

View full profile

The best resource I have found to walk you through options is a Training Webinar avallable free 24/7 through Freddie Mac.

[content removed by moderator for being self promotional]

Flag content

March 15 2009

Alejandro Cruz, CDPE, "AlexCruzRealtor"
Contributions: 47

Alejandro Cruz, CDPE, "AlexCruzRealtor"

Real Estate Agent

View my 3 listings

Contributions: 47

Q&A

:22
Disc

:3
Photos

:22

View full profile

A divorce is a legitimate hardship. You may qualify for a short sale. That is your best alternative. Whatever you do, don't let your home foreclose.

Flag content

March 17 2009

Deanna.Ritz
Contributions: 8

Deanna.Ritz

Contributions: 8

Disc

:1
Photos

:7

View full profile

The decision could go either way. An important part of the decision is do you have just a first or do you have a first and a second mortgage? Are your payments current at this time?

Flag content

March 19 2009

Sean Seymour, "heppeh1"
Contributions: 13

Sean Seymour, "heppeh1"

Real Estate Agent

View my 4 listings

Contributions: 13

Q&A

:3
Disc

:6
Photos

:4

View full profile

This is a position that many people reach. They get tired of fighting the fight with their lenders and creditors. Don't give up! You will thank me later...and here's why.
Foreclosure is a 7 year commitment to a bad credit score, no matter what. Short sale or loan modification is not necessarily the same black mark on your credit. You will re-build in a year or two so don't commit to something like foreclosure for 7 years.

In addition, if your house goes to the foreclosure auction and gets sold (usually for a lot less than what you owe) you may still be liable for the difference between what was owed and what it sold for. Many times if your agent has experience with short sales you can negotiate that difference and typically walk away clean.

[self-promotional post, removed by moderator]

Good luck!

Flag content

March 19 2009

Sean Seymour, "heppeh1"
Contributions: 13

Sean Seymour, "heppeh1"

Real Estate Agent

View my 4 listings

Contributions: 13

Q&A

:3
Disc

:6
Photos

:4

View full profile

This is a position that many people reach. They get tired of fighting the fight with their lenders and creditors. Don't give up! You will thank me later...and here's why.

Foreclosure is a 7 year commitment to a bad credit score, no matter what. Short sale or loan modification is not necessarily the same black mark on your credit. You will re-build in a year or two so don't commit to something like foreclosure for 7 years.

In addition, if your house goes to the foreclosure auction and gets sold (usually for a lot less than what you owe) you may still be liable for the difference between what was owed and what it sold for. Many times if your agent has experience with short sales you can negotiate that difference and typically walk away clean.

[self-promotional post, removed by moderator]

Flag content

March 19 2009

LyndieQ
Contributions: 236

LyndieQ

Contributions: 236

Q&A

:104
Disc

:132

View full profile

Stop spamming, Sean Seymour. It's not all that tricky that the url you posted 2 times in the last day redirects straight to your business website, but it does make you appear deceptive. Fernando Herboso, even though yours was almost a month ago, posting your business url is against Zillow's Good Neighbor Policy. Let people decide for themselves if they want to go to your website and/or contact you.

Flag content

March 20 2009

Walty804
Contributions: 1658

Walty804

Contributions: 1658

Q&A

:127
Disc

:1520
Photos

:11

View full profile

as many times as i have bumped heads with AZRob he is right here too.

its funny how most the sales people here say dont forclose...knowing that it will just drag thier industry down even more. if they were in your shoes they would be thinking about doing the same thing. they dont see it though because they are blinded by thier need to sell. understandable.

if you were sold some flimsy 100% financing, short term fixed, ARM and brought little if any money to the table and were upside down 30, 40, 50% or more i would then consider bailing.

Flag content

March 20 2009

nvchaz
Contributions: 1617

nvchaz

Contributions: 1617

Q&A

:729
Disc

:821
Photos

:67

View full profile

I'd just walk.

With 40% of the population with either a foreclosure or a BK on their record in five years, we'll be grading on a curve.

In fact, I haven't even bought a house yet and I'm thinking about walking away from it.

I predict the nefarious FICO brothers will be OOB by 2012.

Flag content

March 20 2009

nvchaz
Contributions: 1617

nvchaz

Contributions: 1617

Q&A

:729
Disc

:821
Photos

:67

View full profile

BTW,

Stretch it out as long as you can and pocket the mortgage payments to save up for a nice rental until you get close to a sheriff's visit.

Call up the lender and ask for "key money" $2K-$5K to walk away clean from the property.

If the lender balks, gut the interior. Put everything: kitchen cabinets, toilets, light fixtures, appliances, etc. on Craig's List for sale. Just be sure to indicate "you remove" on the ad so you don't have to break your back.

Finally, on the day of your leaving, give your kids some baseball bats and tell them that you want to play "Pinata" with the house. Call it a day when the dry-wall dust gets too heavy.

Flag content

March 20 2009

Tools

Create an Email Alert

This alert is for the following:

How often would you like the alert emailed?

Partner Tools

Nearby States

Nearby Cities

Nearby Neighborhoods

What if I owe way more then my house is worth? Should I just walk away and let it foreclose?

Contributions: 5

Replies (63)

Contributions: 128

Contributions: 5

Contributions: 5

Contributions: 5057

Zillow All-Star

Real Estate Agent

Contributions: 942

Zillow All-Star

Real Estate Agent

Contributions: 45

Real Estate Agent

Contributions: 4

Real Estate Agent

Contributions: 1124

Zillow All-Star

Contributions: 12572

Zillow All-Star

Real Estate Agent

Contributions: 47

Real Estate Agent

Contributions: 8697

Zillow All-Star

Real Estate Agent

Contributions: 1138

Real Estate Agent

Contributions: 479

Zillow All-Star

Contributions: 2

Real Estate Agent

Contributions: 37

Real Estate Agent

Contributions: 37

Real Estate Agent

Contributions: 8697

Zillow All-Star

Contributions: 119

Real Estate Agent

Contributions: 45

Real Estate Agent

Contributions: 59

Real Estate Agent

Contributions: 186

Real Estate Agent

Contributions: 831

Real Estate Agent

Contributions: 47

Contributions: 8

Real Estate Agent

Contributions: 13

Real Estate Agent

Contributions: 13

Contributions: 236

Contributions: 1658

Contributions: 1617

Contributions: 1617

Main Image

Have a question? Ask it here.

Most Active Maricopa Real Estate Agents

Related Discussions

Discussion What if I owe way more then my house is worth? Should I just walk away and let it foreclose?

Be A Good Neighbor