Best way to let house go back?

I lost my job & can’t afford it anymore. Bought house 3 years ago. Should I just quit making notes & let bank repossess or file bankruptcy? I have great credit & understand this will ruin credit, but i have no choice.

I live in a really small town & plant shut down. So will not be able to sell it.

 

I have nothing to contribute besides that I hate to hear of your troubles and I wish you good luck during this period of your life. This is just another turn in the road.

 

If it were me, I'd call the bank and explain the situation. I have no idea what they will say, but it feels like the right thing to do.

 

Talk to the bank and/or a real estate/bankruptcy lawyer. Depending on the state you live your legal rights will differ. Note TW is not the best source for this type of advise.

However, odds there are many in the town like you and the local real estate market is about to tank. The bank may not want to repossess the house, although, they may not have figured that out yet. The point is what are they going to do with it? If they kick you out then they have to maintain the property. If there are a lot people in a small town, then local banks have a problem along with you. People have lived in houses many years without making payments. Its known as a zombie foreclosure.

Goodluck.

 

Bank might let you pay interest only for a few months while they extend the term.

There might be some advice about making some payments vs nothing at all.

First call is the loan originators. Good luck searching for a new job.

 

Sorry for bad luck— Everyone’s situation is different but if hard to find work over there and you could travel for work—thousands of people are being put up in mancamps working 14 and 14 jobs between midland and pecos tx— good luck

 

Do u have mortgage insurance?

 

Really sorry about the situation OP.

I suggest to sell it immediately. In the last 3 years, I imagine the value of the property went up.

Use the money from the sale to pay off as much of the remaining principal of your mortgage off, then see where you stand.

Good luck, and keep us posted.

 

I did up to about 3 months ago.

 

Some lenders will work with you to reduce payments rather than going into foreclosure. Nothing to lose by asking. Shame you can't find a buyer or renter.

 

Don't know your local laws, not an attorney so mute point.

If your local bank still owns the mortgage, go talk to them. Much more likely to try to work out. We have a deed in leu of foreclosure option rather than a full blown foreclosure. You voluntarily move out and deed the property to the mortgage holder, they waive the right to pursue any shortfall if there is one when they eventually sell it. Not a good option if you have good equity. Upside is you walk away unburdened with accruing property taxes, maintenance, late fee's, lender's legal fees, etc.

If you have good credit now, document everything through whatever route you chose, including layoff notices, etc. Your credit will take a hit no doubt, but some lenders will be more sympathitic afterwards if you show good faith in trying to work it out rather than the "zombie foreclosure" route mentioned earlier.

If mortgage holder is a big national lender, speak with a real estate attorney.

 

Do you know what kind of mortgage you have?

In some cases the bank can take the house... but that doesn’t mean you are in the clear. The bank can still come after your for what is owed on the residual.

I second the recommendation to talk to a bankruptcy attorney.

I would try to go with the system as much as you can and not just stop payments without understanding how you’ll move forward. Now if you can’t make payments thats another story.

Foreclosures don’t happen overnight. Typically the process starts after so many missed payments. It can take two years to go through a foreclosure. So don’t feel like the bank is going to crush down on you and you’ll be homeless in a few weeks.

Sorry to hear of your jobloss. I wish you the best in this situation.

 

can you rent it out? Id find a competent realestate agent, find out about selling, and or selling in a short sale. It will impact your credit but not as hard as a bankruptcy or foreclosure.

 

I did what I could, working jobs beneath my previous skill/experience, working seven days if needed. Asked around, newspaper, Employment Office, under the table work. No late payments ever.
Duane

 

Strategic foreclosure. I went through it about 6 years ago during a divorce. I tried to work with the bank and get a short sale approved to get out from under it and the bank wouldn't approve a short sale. Insane, but they don't care, it's all a write off to them. So we walked away from the house and it took about a year and a half for the bank to foreclose. Then bankruptcy, then the rebuild. The biggest question is if you have any other assets you need to protect. Did your employer give you a separation package of some sort? Do you own any expensive toys? Other properties? The bankruptcy court could very well take any of that from you. I did some very deep and shady but totally legal things to protect some assets of mine. If you don't really have much for other assets and it's only your credit rating you are worried about then you are all set for the most part. Your first step is calling the lender and telling them your situation. Ask them about approval of a short sale. I know the plant shut down in your small town but if the house can be sold for below market value, someone might snatch it up, you'd be surprised. It may also buy you some time with the mortgage company just having it listed. Then get yourself a bankruptcy lawyer. This will cost you some money to file unfortunately. About 3 or 4 years later and I have a higher credit rating than I ever had before.

 

I know a young guy who used his house for collateral. Business slowed along with the economy. He tried to save things, but payments were wasted as the bank took it all. He said he should have walked away and kept the extra money instead of trying to make the lender happy or forestall matters.
Duane

 

That's what I did years back when things blew up and we had to move. It required moving to another state and getting work, but I didn't lose the house. We just hired a realtor/ property manager to rent it and put it on the market.

 

Talk to your lender first, see what they can offer. If they arent willing to play ball then you need to speak to an attorney. I would also go speak to your local real estate agent. They may know of an investor that would interested in making a bid on the house. Giving up and jsut plain walking away would probably be the last option I would pursue.

 

Ok i put in the market yesterday. The realtor is really confident that the house will sale. But I think all realtors are optimistic. It is a nice home 2800 sq , brick, concrete drive, 30x40 shop all on fenced in 5 acres. Wish me luck. I will keep you guys updated

 

Good luck OP. Hate to hear of your situation. Hope it turns out for the best.