NEED CA FORECLOSURE HELP FROM JULIO!!!!


Posted by Jennifer on February 26, 2008 at 22:37:45:

Julio, I've read many postings here and know you are the best to ask. Here is our history and what we've decided is our best option. We have purchased our first home in Perris, Ca in 2004 at the peak when home prices were rising $10K a week and we were due with our first child in less than 4 months. We loved our community but didn't really look into the area like we should have. Well, suffice it to say, we've lost in this market. Our community has only a few residents fighting to maintain the little bit of beauty it still possesses after the constant graffiti, tagger's, sign stealers, drug busts and ghetto renters have moved in. We've tried selling last year and only 1 person came to look with no offer within 6 months. Our home is now worth less than we owe (current appraisals $189K vs current loan $398K) and I don't see us breaking even for another 7-10 years if that. And that is only if we can control the decline in residents moving in and out. We purchased the home under my name only and have decided that it is better for us to take the loss and mess my perfect credit up a little in order to move into Temecula for the better of our children's future. In other words, we will foreclose with our lender. We have thought long and hard about it and have decided that we can't wait any longer. The market is too bad in Perris and the homes we couldn't afford three years ago in Temecula are now within reach. We both have good to excellent credit, a lot of credit on my name, but not even one negative. So, my husband has never used his VA loan and because we won't make any money on this home, will use that since we have no down payment. The maximum allowed for VA purchase with no downpayment is $417K. So, we will limit ourselves to this amount and get preapproval first and then go purchase a home under his name only and then foreclose on our present home with our lender, that way, in case they need me on the VA loan, my credit is still good. I just ran my annual credit report on Feb 8th and I have no negatives on any reports and my FICO score is probably in the 680 range because I have too much credit. My husband will run his report soon too and because I pay the bills, know his has no negatives as well. His FICO is probably higher. I have very specific questions to ask prior to my foreclosing on my current home that I need help with.
1. Our current home is in the name of our living trust. Should I first deed it back to myself as my sole and separate property again prior to foreclosing?
2. In reading my 2nd mortgage contract, I didn't find any recourse clause by the lender but did notice an acceleration clause in the grant deed section. It also stated they were subordinate to the first lien holder and if I forclosed would sell the property at their discretion and use those monies to recoup losses. Didn't notice any "deficiency judgement" type wording accept to say that they have the right to accelerate the payments due immediately. Question is: Should I be concerned about my few assets, namely two unpaid cars under my credit? What other types of assets could they take if I have no stocks, bonds, IRAs or money in bank?
3. Should I remove my name from our joint bank account?
4. If the first lienholders loss for our home is around $200K, and the second $60K, and I just don't pay, how specifically could they come after me personally? Only through assets?
5. Last question, I am self employed with a c-corp that has my current home address as the place of business. There are no assets and I have shown a tax loss since it opened two years ago. How will this business be affected? I cannot move it because it is a business taking care of elderly and the state will only license the home.
Tough questions but I know you will be able to help. I appreciate any input from anyone else too!
Look forward to hearing from you. Thanks, Jennifer


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