Loans, Debt & Credit - View Single Post

ldelrosa · 12-20-2008, 04:54 PM

Hi, I've been posting in another thread for Loan Mod. Now we're graduating to foreclosure since my husband's sickness is getting worse and I wont be able to pay for 2 homes as single earner (besides the fact that we are almost $300k underwater)
We tried so hard to modify our 2 loans since 08/2008. We havent paid since 05/08 and now have the notice of sale for 2/09 posted on our door. At the same time we received an a mod offer @1.5% int fixed on our first. We also received a settlement offer of $16k for the $96K on the 2nd. What to do?
Details:
Purchased: 2004, Location: CA, $480k
$330k 1st Loan gmac/$96K 2nd Loan nat'l city, down $50k
Purchase Loans -Yes
Similar houses are now selling for $200k.
Questions:
(Please - I will also be looking for a real estate/debt collection lawyer next week but will appreciate any response from anyone who has had any experience with this, I've consulted 3 lawyers who gave us different answers. One said he does not know real estate law, another charged $7k before answering any questions and 3rd took our $3k for bankruptcy but ended up advising that we could not file for bk since our other home has equity- hence losing $3k for nothing).
I read a lot of the postings here but have some questions on non-recourse loans etc when we do foreclose.
Is our 2nd loan non-recourse (since we borrowed at time of purchased and lived in the house for less than 2 years?) Will our 2nd have the right to charge off and sue us and should we settle for $16k for $96k or is it too much? Our 2nd calls us everyday to collect and even though we have settlement in process for January, they demand min monthly payment otherwise they said they will charge off the loan. Should I pay the minimum or save the money for next month?
If I accept the loan mod offer (1st), settle on 2nd and live for 4 more months (to complete 2 years residence), we would qualify for tax relief (we've est. to be $70-$150K). Is this questionable by IRS since our other house is nearer our work? Our college son and daughter live in our other house but our foreclosure house is our principal residence now. Our bk lawyer said this is ok though but i am not so sure.
Thank you so much for any help you can extend - I'll update you as well as to what happens afterwards...

12-20-2008, 04:54 PM	#1 (permalink)
ldelrosa Senior Member Join Date: Oct 2008 Posts: 49 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Finally walking away from loan mod Hi, I've been posting in another thread for Loan Mod. Now we're graduating to foreclosure since my husband's sickness is getting worse and I wont be able to pay for 2 homes as single earner (besides the fact that we are almost $300k underwater) We tried so hard to modify our 2 loans since 08/2008. We havent paid since 05/08 and now have the notice of sale for 2/09 posted on our door. At the same time we received an a mod offer @1.5% int fixed on our first. We also received a settlement offer of $16k for the $96K on the 2nd. What to do? Details: Purchased: 2004, Location: CA, $480k $330k 1st Loan gmac/$96K 2nd Loan nat'l city, down $50k Purchase Loans -Yes Similar houses are now selling for $200k. Questions: (Please - I will also be looking for a real estate/debt collection lawyer next week but will appreciate any response from anyone who has had any experience with this, I've consulted 3 lawyers who gave us different answers. One said he does not know real estate law, another charged $7k before answering any questions and 3rd took our $3k for bankruptcy but ended up advising that we could not file for bk since our other home has equity- hence losing $3k for nothing). I read a lot of the postings here but have some questions on non-recourse loans etc when we do foreclose. Is our 2nd loan non-recourse (since we borrowed at time of purchased and lived in the house for less than 2 years?) Will our 2nd have the right to charge off and sue us and should we settle for $16k for $96k or is it too much? Our 2nd calls us everyday to collect and even though we have settlement in process for January, they demand min monthly payment otherwise they said they will charge off the loan. Should I pay the minimum or save the money for next month? If I accept the loan mod offer (1st), settle on 2nd and live for 4 more months (to complete 2 years residence), we would qualify for tax relief (we've est. to be $70-$150K). Is this questionable by IRS since our other house is nearer our work? Our college son and daughter live in our other house but our foreclosure house is our principal residence now. Our bk lawyer said this is ok though but i am not so sure. Thank you so much for any help you can extend - I'll update you as well as to what happens afterwards...