Foreclosure...and my situation?
Hi everyone I know I need to talk to an attorney but I would like to hear other peoples thoughts and experiences as well. First of all I am 29 years old...So i think I'm young enough to start over if I need to. I purchased a new build home in Oct 2006 in Columbus Ohio for $163,000. Today i owe $158,000 and all payments are current. For years I have never been late on any bills...My credit was 733 the last time I saw it. I went thru a divorce in Sept 2008. After the divorce I picked up a child support payment of nearly $800 a month...Well $600 for support and half of the babysitting cost which are $200 monthly. So a total of $800 a month. Because of this situation and the current economy I cannot afford the house, rent it out for the $1500 monthly payment, find a roomate, or sell it...I have tried to do all 4 of those things. The house is solely in my name, my ex wife has no connection to the home and she doesn't have any money anyways. I was able to rent it out last may for $1000 a month...which is no where near the $1500 payment, meaning I have to pay $500 a month out of my own pocket every month. My tennants are moving out this May 2009. Similiar homes in the nieghborhood rent for roughly $1000 a month, so to ask $1500 for rent is not going to happen. I have notified my bank and informed them of my situation and that my saving account has significantly decreased since last May as a result of pulling $500 a month to stay current. The bottom line is I cannot afford this house nor do I want it anymore. I tried to do the right thing but is it worth draining my savings to $0 and still losing the home? I have $4000 left in my savings. The home is prob only worth around $120,000 cause of the economy. Wells fargo is not taking me serious because all payments are current. I will probably stop paying after May 2009 when my tennants move out. I'm not left with any other choices. Unless wells fargo would drop the house payment from $1500 to around $700...i cant afford it. And i don't thing they will drop it that low for me. and this a V.A loan as well...if that means anything What are my options? Should I take my last $4000 and pay off credit cards and other bills instead of putting it into this house that i'm going to lose? Are they going to go after my 401k retirement? Will I get 1099 next year? Will I be sued? The bank would doubtfully deed in lieu? These are questions I have and I will talk to an attorney, but I'd appreciate everyone else's view. Thank you and I'm sorry to contribute to the American foreclosure mess, but divorce has really left me no options
Public Comments
- Contact the U.S. Department of Veterans affair directly to see if one of VA financial counselors can help you out (the phone number I saw on their web site gave the number as toll-free at 1-877-827-3702.) The problem that I see is that I can't see them being capable of dropping your house payment from $1,500 to $700. Outside of foreclosure (because again I think your asking to much to be able to do a loan modification from $1,500 to $700), the only option I can think of is a short sale (assuming the lender will approve it).
- You're certainly young enough to start over. Like too many others you've gotten yourself in to a situation where you have too much house with too little equity. First I would make a monthly budget accounting for EVERY dollar you make and spend. Bring it to the bank and speak to someone face to face so they can se you're serious and the situation is dire. Tell them your prospects for making more money and see if they have any recommendations. If they don't have any suggestions ask them what their process is for foreclosure or short selling. You don't say where you're living. Could you afford the house with two roommates? Many people are in the same boat as you and would love having a place to stay for $400 - $500/month. In the meantime you should be living on beans and rice and paying off any other debts you have. Keep at least $1000.00 for an emergency fund and cut up your credit cards. If you have any possessions you don't absolutely need sell them. You can always buy more later when you're back on your feet.
