Stop paying mortgage and short sale? - Loan Modification Forum

UpsideDownMommy · 08-05-2009, 08:28 PM

Quick background: Bought in 2006 in CA, paid $345. Now is worth about $200K. Our place is too small for our growing family, no yard, etc, and at this rate our likelihood of getting out of it and into something bigger before our kids are grown is not looking good. We did an 80/20 (first, plus line of credit), put $0 down.

Our idea is to stop paying our mortgage, save the $ we don't pay, do this for about 6 months and then try to short sale. So we start foreclosing and then just save the credit hit at the end by short sale. Does it work that way or does credit erode as you go along? And is that legal?

dnathan · 08-11-2009, 10:42 AM

I'm not a lawyer, but I'm pretty sure the bank will just add what you didn't pay to what you owe, along with late fees. Your credit would also be damaged, which it wouldn't be if you short sold.

Paul Molinaro Esq. · 08-20-2009, 05:25 PM

NO LEGAL ADVICE HERE - JUST GENERAL INFORMATION - ANY SIMILARITIES TO ANYONE'S ACTUAL SITUATION IS JUST ONE HECK OF A COINCIDENCE.

SHORTS SALES DAMAGE CREDIT SCORES

Credit is wrecked when a borrower misses payments, when a borrower short sales, when a borrower filed BK, and when a borrower gets foreclosed upon, as well as a whole bunch of other things.

- Paul

08-05-2009, 08:28 PM	#1 (permalink)
UpsideDownMommy Member Join Date: Jul 2009 Posts: 6 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Stop paying mortgage and short sale? Quick background: Bought in 2006 in CA, paid $345. Now is worth about $200K. Our place is too small for our growing family, no yard, etc, and at this rate our likelihood of getting out of it and into something bigger before our kids are grown is not looking good. We did an 80/20 (first, plus line of credit), put $0 down. Our idea is to stop paying our mortgage, save the $ we don't pay, do this for about 6 months and then try to short sale. So we start foreclosing and then just save the credit hit at the end by short sale. Does it work that way or does credit erode as you go along? And is that legal?

08-11-2009, 10:42 AM	#2 (permalink)
dnathan Member Join Date: Apr 2009 Posts: 17 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Stop paying mortgage and short sale? I'm not a lawyer, but I'm pretty sure the bank will just add what you didn't pay to what you owe, along with late fees. Your credit would also be damaged, which it wouldn't be if you short sold.

08-20-2009, 05:25 PM	#3 (permalink)
Paul Molinaro Esq. Attorney Join Date: Mar 2009 Location: 980 Montecito Drive, Suite 206, Corona, CA 92879 Posts: 133 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Stop paying mortgage and short sale? NO LEGAL ADVICE HERE - JUST GENERAL INFORMATION - ANY SIMILARITIES TO ANYONE'S ACTUAL SITUATION IS JUST ONE HECK OF A COINCIDENCE. SHORTS SALES DAMAGE CREDIT SCORES Credit is wrecked when a borrower misses payments, when a borrower short sales, when a borrower filed BK, and when a borrower gets foreclosed upon, as well as a whole bunch of other things. - Paul __________________ ______________________________ Paul J. Molinaro, M.D., J.D. Attorney at Law, Physician, Broker ______________________________ Fransen & Molinaro, LLP 980 Montecito Drive, Suite 206 Corona, CA 92879 pmolinaro@LoanLaw.net 1-888-756-2652 ______________________________ The information contained in this post is NOT to be taken as legal advice. My posts are for general information and educational purposes only. If you need legal advice, please contact an attorney.

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