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Like many Americans, I have been unemployed for almost 3 years. Along with some serious health issues and a divorce, the last 3 years have been a true hardship. I have managed to continue to pay both of my mortgage loans. I have contacted my mortgage company and applied for assistance. I was told each time that I do not qualify for any assistance because my debt ratio is too high, in other words I am broke. They don’t consider my situation a hardship. How can I be too poor to get help and what other issues besides, unemployment, illness and divorce is considered enough of a hardship? They informed me that I can either sell my house for less than I owe or turn it in to them. After 13 years of on time payments. They do not care if we are homeless. Do I have to stop making payments to show I need help and if so, how many missed payments before they kick me out? Even though I am managing to make the payments, my home is falling apart and I have no way to make the repairs, which makes me feel even more trapped and wanting to leave the whole mess. Is there any free/low cost programs to help with repairs? I want to walk away but, have nowhere to go; since I can’t even rent an apartment without a job, unless maybe I can get a co-signer (does anyone know if this would be acceptable?)

4 Thoughts on Should I try to short sell my house, walk away (turn it in to the bank) or allow a foreclosure of my house?
  1. Reply
    Dan T
    February 15, 2014 at 9:58 am

    Personally I don’t know much of this stuff but I’m in the same boat practically ‘look at my newest question haha’ but if I were you talk to someone in person who knows what to do exactly, if you have enough money contact a lawyer. In this country all we have to show is our personal belongings it seems, everyones homes are being taken away due to the economy and unemployment. If I was in your situation I’d do what I can to keep that house unless its too far gone. If its too far to pay for, try to get the most money you can out of it, make sure you have a place to stay before then obviously.

    I don’t know where you live but you should apply for HUD which is a low income housing authority,go to your local welfare office or housing authority to talk to them about it, they pay most the bills for you and you just pay a part.

    Like I said though do what you can to keep the house because many people already don’t have homes do to this bull crap.

    I’m sorry I dont know much about programs to help you with your mortgage, again try to go to a lawyer or a adviser in that section to get further help and advice.

  2. Reply
    richard t
    February 15, 2014 at 10:35 am

    Banks are not in the welfare business. They really do not care how long you have made your payments, only what you owe on it and if you are current in your payments. Usually the people that own your loan may have just purchased it and it could have been sold several times since you orginally signed the documents, so frankly they really do not care. Sometimes they do modifications but this is so that they can keep more people in their homes and they actually save themselves money in doing this. It looks like modifying with you is pointless, since they do not even believe that you can handle lower payments due to your lack of income. Ok, so what do you do? A short sale is the best thing you can do if you are concerned about your credit. You won’t be able to buy a house for 3-5 years or get much credit for anything but it is still looked upon better than a foreclosure. The drawback of a short sale though are that you will likely have to move out sooner. If you do not care about your credit or if you have no other place to stay and you need to save what money you have, then just quit making payments and eventually they will work your house through to foreclosure. In some states that can take over a year but typically I would count on a few months. If your lender can’t find the documentation on your loan or they have other issues like that then you might be able to stretch it out even further. Best of luck getting though this mess. Many do land on their feet and are on to better things.

  3. Reply
    rswpbc
    February 15, 2014 at 11:22 am

    In reality, the bank doesn’t see a hardship because you are still able to make your mortgage payments. What you need to do is write a hardship letter (again) stating what you stated here, stop making your payments (save your money) for at least 3 months and ask if they will approve a short sale. You can not do a short sale on your own unless your bank approves it. A short sale is what they were talking about when they said that you could sell your house for less. Sometimes it takes 60-90 days but more than likely a bit longer for you to have to move out. You do not want to get a co-signer for anything because that would again put you behind, you would not be moving forward.

    You have more options then you think and you do not have to get an attorney to get through this.

  4. Reply
    TJ Danzii
    February 15, 2014 at 12:15 pm

    Besides the hardship that your going through, you would have to understand exactly what your dealing with, ie Loan amount due, Equity, Repairs that need to be done, so on and so forth.

    Email me at [email protected] and I can talk to you about your options and whats best for you, you may be able to walk away with some cash at closing but I would have to know your situation.

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