Going to stop making payments effective 12/1/09

[rcr32763]

Hi everyone,

I have a mortgage with Chase for my condominium here in Florida. I purchased it back in June 2007 for $149,900. My payments started out reasonable, but jumped $150 earlier this year, due to a mistake when calculating my escrow. It is difficult to make my monthly payment, but I am able to (by tapping into savings every month).

I have seen the value of my property continue to plummet since I purchased. Just this month I saw another unit identical to mine listed at $72,900. So I have lost $77,000 (over 50%) of my property value. Real estate agents in my area say they don't think people in my community will EVER recoup their investment.

I am thinking about walking away. I no longer like the community I live in, as it has basically become an apartment complex. 12/1/09 will be my first missed payment, if I choose to go that route. Has anyone else who is able to make payments intentionally walked away from their home? If so, can you please share your experience with me, such as how long the foreclosure process took for you? For those of you with condos - did you continue to pay your HOA fees? I currently have a very good credit score (around 750), and I hate the idea of foreclosure, but I have been told I am not eligible for a short sale because I have not experienced financial hardship. I know Chase won't work with me because I am current on payments. I am not sure what to do, but leaning towards just letting it go!


Please let me know your experience if you share a similar situation. Thanks!

[briknope]

absolutely yes, stop paying. Do not drain your savings. Your credit will take a hit big time. Chase will call for sure after a few missed payments. Play dumb and broke. Do not fall for their trial payment programs of any sort. Bank the money and expect foreclosure. If they come up with something then so be it. You can buy another home soon afterwards, in about 2 years at the most for half as much. I wouldn't pay HOA either. That lien or debt will get wiped out in foreclosure. Again, SAVE money...you may need it to get a place to rent OR pay off HOA if acceptable terms are made by Chase.

[yomann]

[QUOTE=rcr32763;146555].......12/1/09 will be my first missed payment, if I choose to go that route.........QUOTE]
If you read the various posts here, you will find that lenders do not even want to initiate a dialogue with you, unless you are at least 60 days behind.
In fact, many loan assistance agents of the bank suggest you fall behind to get your voice heard.
So, save your money and see what develops next .......

[KFish]

Hi rcr...

We have three condos in AZ (rentals) that we are going to stop making payments on effective November. We can scrape by to afford it (trying to work overtime, dip into what is left of our savings, etc) but are choosing not to. We arent that much upside down in them but we took big pay cuts this year, and are told more are coming in 2010. We are basically considering this a "business decision" to do what is best for our family, long term.

I met with a real estate attorney last week about this. He told me it was best to keep paying the HOA fees (not what I wanted to hear, they are pretty pricey) because they can come after us, and it can further effect our credit. Not sure why it matters though, since our credit will basically be demolished in about 60 days! This may just be his best guess though...we know someone else that walked away from about a dozen investment properties. He didnt pay any HOA or taxes, nothing...once he made the decision to walk. He said they called for a while, then gave up. His homes were sold in January this year, and he hasnt heard anything.

Why are you waiting until December?

[davephx]

The HOA fee situation is hard at least for me to understand in Ariz.

It does have personal liability not just can lien against the property.

Here is where its confusing to me, but I THINK if there is a foreclosure sale the HOA has to come after you within 30 days of the sale to collect against you personally.

Another bad thing trying to sell condos etc is that if more than 15% are delinquent in HOA fees a new buyer can not get financing due to a Fannie/Freddie requirement. Lots of condos in AZ have more than 15% not paying HOA.

Even bigger problem for the HOA which still has to pay in my case for water/sewer/trash all the common area utilities, RE taxes and maintenance. So they have to increase HOA fees on current owners which drives more of them out but very hard to sell of buyer can not get financing.

Good article about the financing issues at
http://www.cmgfs.com/Media/Christian...HOA-091009.pdf

[SillyWorld]

Sounds like a deal to me, I have been up to date on my mortgage all along getting sick of wait and wait and wait for anything...1 Late should not be too bad, but could be enough to get emm looking at my account

[Isabel]

GThey will start calling you after the 15. If you decided to walk away why December? Sometimes you have to think of it like is your credit worth 80k since you are under 80k. My home is about 120k under in Florida. Credit will be hurt (my score is about 790) but oh well. We think life and family and health are wayyy more important. My husband lost his job and I can probably make the payment if I dig into savings but from everything I read here, it will probably be difficult to get a loan modification and banks wont even listen until you are a few months late anyhow. Loan modifications might not even turn out permanent anyhow. So its a hard decision but I dont want to live looking for pennies under the couch.

[Kalvin09]

I think I am in the same situation as you(RCR), except that I am in Michigan. I have decided to stop my payments starting from 11/1/09.

[AZOwner]

In az, walking away from our primary residence. If you search the forum for hoa, property taxes, and insurance, I believe you will find that you must continue to cover them, legally, until the home is sole/foreclosed upon.

We saw an attorney that affirmed this. You are pesonally liable for HOA, Property Taxes, and Insurance as a seperate debt from the home.

HOA can come after you, and also sue you for court fees. They will get a judgement against you, as would the State.

If you let the insurance policy lapse the mortgage company will do you a favor and assign you absorbanent amounts to arrange for coverage.

It's an individual decision, and a risk you have to weigh . . . kindof like walking away in the first place!

Good luck to you.

[SwillerAlesbane]

"Going to stop making payments effective 12/1/09"

The real question is.....How many people around the country are thinking the EXACT same thing?

Should put chills up the banksters spines, but they'd rather die then forgive any debt.

[rcr32763]

Thank you all for your responses!! It seems like the general consensus is to walk away. To answer the question that several of you had - I actually normally pay my mortgage a few days early, so I had already made the 11/1/09 payment - then heard about the unit right next to me that is listed at $72,900. Had I known about that, I would not have sent the check to Chase. I basically feel as if I am just throwing money away at this point. I don't see my property value coming back anytime soon (if EVER). Where I live is basically apartments now - and the sales office is now a "leasing office". No one will ever want to buy now. It's a bad situation, but I feel it is best to cut my losses now. Several of my neighbors are walking away (or planning to) as well and one of them told me that they have not been paying since January and just got the notice of default a few weeks ago. Wow!

Again, if you share a similar experience, I would very much like to hear your story. Thanks!

[wild-goose chase]

Swiller, I think lots of people are thinking the same thing. I'm walking away in Arizona as a strategic default. My condo is too far underwater, having lost 45 percent of its value (and I put down 20 percent and have only a 1st with Chase) and, get this, the HOA decided that now is a great time to impose a $7000 special assessment to fix structural problems that should and could have been addressed twenty years ago! I will continue to pay the HOA, property taxes, and insurance until the title is transferred.

Of course, if Chase were to actually begin helping homeowners, instead of fleecing them for their last dollars, I might reconsider.

[briknope]

here's something to read:

Property Taxes, Hazard Insurance, HOA Fees, and Foreclosure

liens get wiped out after the foreclosure. Bank WILL pay the taxes on it, because they don't want to grapple with the government in trying to collect on their loss. In my case in Arizona, my property taxes are impounded and only about 1800 a year. HOA is roughly 1000 a year. Like I suspected they (CHASE) is paying the Insurance and Taxes on my home and they are current. My HOA is currently delinquent, and I don't care becasue if the home goes to foreclosure that lien will get wiped out. If I end up staying and CHASE works with my, I will be happy to go right down to the HOA office and cut them a check for the amount past due. If anyone else sues me or comes after me so to speak...hey I already got a big Foreclosure on my credit, might as well BK also and become totally debt free. Have no fear is my motto. Done 2 BK's in the past, maybe 3 is the charm. Have NEVER had much problem doing day to day things like buying cars or getting credit cards. This house I have now? That was a 0 down 5 years out from the last BK. So its not a big deal to me. Again, thats me...

[davephx]

Originally Posted by briknope

here's something to read:

Property Taxes, Hazard Insurance, HOA Fees, and Foreclosure
liens get wiped out after the foreclosure.

But according to the article HOA can go after a judgement against you for fees while you still owned it. They just often don't due to legal costs, but if your way behind would be worth it for the HOA to go after you.

I THINK.. I read somewhere... in AZ they have to come after you within 30 days of the foreclosure sale but am not sure.

[briknope]

Originally Posted by davephx

But according to the article HOA can go after a judgement against you for fees while you still owned it. They just often don't due to legal costs, but if your way behind would be worth it for the HOA to go after you.

I THINK.. I read somewhere... in AZ they have to come after you within 30 days of the foreclosure sale but am not sure.

I'm not too sure on that one....probably they can go after you (HOA's) personally, but like you said it would be alot of money to do that. Condo fees are usually alot higher...I do know the retirement communities are in the 300 dollar a month range, then possibly. When you are talking about modifying a 250k+ mortgage, a 75 dollar a month HOA fee is pennies in my opinion.

[lkszip]

I spent my entire savings and my grandmother's inheritance trying to hang on, keep current and hold on to my 790 FICO score and now still can't afford my payments ... (wish I still had my savings, that's for sure!) stop paying NOW .... live in your condo until they kick you out or come to you with a workable solution ... and hide that money from them!!

[AZOwner]

Okay. . . first, HOA can no longer put a lien on your property in AZ.

If they come after you, they will also sue you for attorney fees. . . . per my attorney.

[davephx]

Originally Posted by briknope

I'm not too sure on that one....probably they can go after you (HOA's) personally, but like you said it would be alot of money to do that. Condo fees are usually alot higher...I do know the retirement communities are in the 300 dollar a month range, then possibly. When you are talking about modifying a 250k+ mortgage, a 75 dollar a month HOA fee is pennies in my opinion.

Mine were $250/month for a 1400 ft condo. But includes water/sewer also.

Unit appraised for $350k in 2007 when I started trying to sell it and kept dropping below value. Today based on comparable listings about $175k but nothing is selling because no financing available since more than 15% are past due on HOA fees. It was sold at trustee sale 9/4 after feeding it for 1.5 yrs and gave up. I owe about 2000+ on HOA which is why the concern.

[Enough Already]

rcr32763,

I'm in FL too. We decided to walk away in Jan 2009. Our plans have evolved and changed since then, but we're still in the process of leaving (either by short sale or foreclosure). Here's a link to my story, I hope it's helpful: Walking Away in FL - Recourse State

Also, I believe you should continue to pay your HOA fees as they can come after you for those.

If you decide to walk you should start a thread in the the Deed in Lieu section of this forum. Good luck and please keep us posted!

EA

[Enough Already]

Also check out this thread: HOA selling my property for 6k debt?

The HOA can, and sometimes does go after homeowners. It's best to keep it paid until the foreclosure/short sale (whatever option you decide to go with) is complete.

EA

[briknope]

Originally Posted by AZOwner

Okay. . . first, HOA can no longer put a lien on your property in AZ.

If they come after you, they will also sue you for attorney fees. . . . per my attorney.

I think its they cannot foreclose on the property. The lien goes against the property and not the homeowner. Anyone to clarify this?

[davephx]

Originally Posted by AZOwner

Okay. . . first, HOA can no longer put a lien on your property in AZ.

Well I got a notice my prior home HOA filed a lien. I am in Phoenix which I think is still in AZ

I haven't found the website that I assume there is where one can check for sure.

[briknope]

Maricopa County Recorder website. Or www.iinvestigate.net will lead you there if you pick state and then county.

[Chased around and around]

I have been on the board of my HOA twice. Each HOA is different, if the HOA has very small reserves which most do they will look at each delinquency case by case. Depending on laywers cost and what the homeowner owes, will depend on if the board will chase you down. Plus you have to add late fees and paperwork costs to every month you are late. So IF you do get a mod you will owe all back HOAs + fees to not have them go after you if you decide to stop paying. HOA all have their own rules, there are no state, county or city rules that HOAs go by.

We had low lawyer costs so our HOA went after owners with lates as low as 1K and we are dues are $368.00 per month...

[dannwa]

Im in a similar situation. I stopped paying on my condo effective 7/1/09 and just got the default notice last week. The details of my situation are in the scuba gear thread. I have been paying the association fees and will continue to do so until chase conducts the forclosure sale. The logic behind this is that it is my intent to stay in my unit and negotiate a principal reduction with chase. Also, though I am in month 5 of not paying I expect that it will be about another 9 months before I leave due to forclosure. Since I am legally obligated right now to pay the association I will continue to do so. If the bank takes the propery back on 12/2/09 as scheduled I will stop paying the HOA at that time.