Profile picture for MJGINSRQ

investment property (vacant land) question

I own a piece of land in Charlotte County, FL which I purchased in 2004 for $210K. I secured an interest only loan with BoA for $199,500 and have made payments on it ever since. the value of the property has steadily declined and at present is worth somewhere between $55-$65 based on lot prices in the area. I am very stretched financially with other loans and in the past 12 month it was tough making payments having to borrow funds from a HELOC for some of them. After an in-depth discussion with my accountant, I was convinced that it just didn't make sense to keep paying on the loan so as of last month, I have stopped. I've contacted a couple of real estate agent to discuss and it sounds like a short sale is going to be one of my only options. The calls from BoA have started and one of my questions is, should I contact them (BoA) to discuss my plan? I did write them about a year ago stating that it was getting tough to meet my obligation but that went nowhere.

If the bank does go along with a short sale is it likely that they will pursue a deficiency judgment? will I know this before signing any papers if the property sells? obviously if they do seek the deficiency, it will be in excess of $140K. does the fact that I've paid in excess of $70K in interest to date make any sort of difference to BoA?

It's not a particularly proud period of my life and in a lot of ways I feel immense guilt for getting into this mess and as much as I tried to do it the right way, continuing to fall backwards trying to make payments no longer makes sense even though it took awhile to sink in.

any help/advise will be greatly appreciated.


  • December 12 2011 - Port Charlotte
  • 0
    0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

Answers (1)

Profile picture for sunnyview
Don't let guilt or regret eat on you. Many people got caught in this mess and now you just have to focus on the best way to get out. I would call B of A and explain the situation. You can ask them about doing a short sale, but if you want advice on avoiding a deficiency judgement, you need to talk to an attorney to see what your options are and the laws in your state are before you sign any short sale or bank contract.

Short sale can work, but since it is land you may be able to negotiate a dee in lieu or something like that where the bank agrees not to pursue you and you agree to hand over the property without foreclosure. You may also have other options that would be better for you. Do not walk away or agree to a short sale without getting  legal advice. You can read more about why here.

Get all the info you can and make the best decision you can. It is a tough situation, but you are not alone. It sounds like you have tried to do the right thing, but that you are having trouble making the payments. There is no shame in being honest with yourself and the bank. All you can do is try to deal with the situation the best you can to move on.
  • December 12 2011
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.