[Angels]

Thanks again Faith, I really appreciate your advice. I only have one loan on this house so that should make things somewhat simpler.

I am in a different situation then most (I think), this particular property is an investment that went bad and I soon realized (and early enough thank goodness) that I will not be able to make the payments. I don’t know if I should start another thread on this topic so please move it if this is not the appropriate place. The background is we were supposed to get a government sponsored forgivable loan for the new construction which would have covered almost half of the cost of the property. This was put in place to encourage new construction in the hurricane hit areas. The rents at the time were high and we ran a worse case scenario what if the rents dropped a couple hundred a month and what if we did not get the forgivable loan and it looked like we could make it no problem under that scenario. Well, this became a “perfect storm” as it slowly sucked us in step by step starting with a higher then projected interest rate, insurance was way more then our lender projected, then the government changed the rules from the first phase to the second for the loan (my understanding was several people got caught on this one) so we did not get that, rents fell several hundred dollars, people are moving out of the area, and because of the incentives there are several new rentals on the market. What also makes our situation somewhat different is before this we invested in other properties (in different areas) and although overall we are loosing money on them we have been able to make the payments. Now that the market and the economy has turned, people are moving out (buying cheap homes) or loosing their jobs so this is really draining us and the Mississippi property put us over the edge. I believe we can continue making payments on the other properties as long as we no longer have this one so it was a decision to cut an arm off to save the rest. Without that property we pay 60% of our income towards mortgages and Costco is our friend. We really, really, really, don’t want to go the BK route (and I don’t think we qualify) so we are hoping for a quick resolution. I don’t know how the bank will view our other investments and try to take them or assess a lean on some or all or what but I am hoping they will be reasonable with us. This does bring up one question, when we get to the negotiation stage (provided they agree to a short sale), would it be beneficial to hire a lawyer or do it ourselves?

On the personal side, like others, we have not slept since coming to this realization and I keep running the past though my head on how we got here. Our credit is (was) above 800 and I have always paid my bills until now - I am really taking this personal. As I read though the posts I feel really bad for others knowing what they are going through and the banks don’t seem very responsive to the homeowners. In any case its feels somewhat good to vent on this forum and to share experiences with others which I appreciate.

As a side note, I saw a thread about “who will rent to us now” and I can say that even before this we always considered the whole person before making a decision to rent to them or not. As an example, one of our renters had absolutely horrible credit because of medical bills, charge offs, etc and has turned out to be a great tenant and later we have come to know her as a good person. I think we got really lucky with her and we hope she decides to stay with us for a long time.