Re: Let it go ...we don't think so...

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Posted by yawni on October 06, 2004 at 04:42:44:

In Reply to: Let it go posted by Mickie on September 25, 2004 at 13:19:27:

: I own a 2 unit duplex with 69K owed that I have not been able to sell. Paying 700mo mortgage, but I can't get an appraisal decent enough to refinance. Could someone please explain the ramifications of foreclosure on credit, financially, etc. Any suggestions would be appreciated.

Call up the lender and try to work out new terms which would lower your payments to break even (cover all expenses from the rental income) or provide a little cash flow incentive for you to keep on managing the property. Lenders do not want the property back and generally prefer some income over the expense of managing REO (real estate owned).

You are going to have to make twelve payments on time before you can refinance. I don't believe that the appaisal is your only problem because that's usually the last thing that's done and paid for after your credit, employment, etc. are approved.

So, it seems that you took out a loan about six to twelve years ago at about what? a 10 - 12 percent annual interst rate, fixed, over a thirty year amortization schedule? Ouch! That's too high, now. So the lender/ current beneficiary probably loves it!

However, the portion of the payment which pays off the principal should be going up to pay off the loan faster every year. Is the income more than $350 per month for each unit?

If that's your loan in your name: do not ruin your credit with a foreclosure. There are quite a few options. Don't give up yet. I think that a bk stays on your credit report for 7 years in Calif. Check for your state. Anyway, it could hurt your employment prospects, insurance rates, and ability to borrow for a long time. Good luck. yawni

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: : I own a 2 unit duplex with 69K owed that I have not been able to sell.  Paying 700mo mortgage, but I can't get an appraisal decent enough to refinance.  Could someone please explain the ramifications of foreclosure on credit, financially, etc.  Any suggestions would be appreciated.



: Call up the lender and try to work out new terms which would lower your payments to break even (cover all expenses from the rental income) or provide a little cash flow incentive for you to keep on managing the property. Lenders do not want the property back and generally prefer some income over the expense of managing REO (real estate owned).



: You are going to have to make twelve payments on time before you can refinance.  I don't believe that the appaisal is your only problem because that's usually the last thing that's done and paid for after your credit, employment, etc. are approved.



: So, it seems that you took out a loan about six to twelve years ago at about what? a 10 - 12 percent annual interst rate, fixed, over a thirty year amortization schedule? Ouch! That's too high, now. So the lender/ current beneficiary probably loves it!



: However, the portion of the payment which pays off the principal should be going up to pay off the loan faster every year.  Is the income more than $350 per month for each unit?



: If that's your loan in your name: do not ruin your credit with a foreclosure.  There are quite a few options.  Don't give up yet.  I think that a bk stays on your credit report for 7 years in Calif. Check for your state.  Anyway, it could hurt your employment prospects, insurance rates, and ability to borrow for a long time. Good luck.  yawni





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