Newbie w/ questions, probably walking in IL

[cuttingthecord]

Hey everyone,

I'm all googly-eyed after reading through so many posts on this site and have found many answers but still have a couple things on my mind...

We live in IL, and from what I've gathered if we let the bank (IndyMac) foreclose they could file a deficiency judgment. I've also learned that they couldn't file a DJ if we do a DIL, so it seemed logical that we strive for the DIL. However, it seems that most lenders want the borrower to try to sell first before they'd consider that option. We are so ready to be out of this house that the thought of spending time trying to sell it just puts another layer of bitter taste in my mouth because we know it will be for nothing (the prospects in our area are grim to say the least). So I don't see the point in even attempting it really. And even if we do attempt to sell and we don't get any offers and then try for a DIL there's no guarantee the bank would agree anyway.

So it sort of feels like a catch-22...and I'm needing a little guidance.

Additionally, I had seen some threads regarding spouses not on the loan being removed from the title for credit reasons- the mortgage is in my husband's name only but we're both on title...am I missing something, because I don't understand why me being on title would have anything to do with my credit. However we are going to keep my credit clean so if I am missing something regarding this, I'd like to know!

Finally, I just have to vent a little! A year ago I'd never have imagined we'd be in this situation, and even though we're ready to cut the cord, it's still not a fun prospect to be facing. I'm so glad to have found this site, though...just wish we would have found it before we sold our kid on the black market to pay the past 6 months of mortgage payments!

[cuttingthecord]

Was saying we sold our kid too harsh?? Sorry, I just have to keep a sense of humor if I'm going to get through everything that's coming!

I thought of a couple additional questions...

What is the likelihood that Indy would actually file a DJ? It's sort of scary not knowing how much the deficiency would end up being...could be "lucky" and have it be around $20K or, more realistically would be more like $50K.

Also, we already input our financials on Indy's website per their request on the recorded message you get when you call them these days...probably will be a couple more weeks before we hear anything. If we're sure we're going to walk away, what's the best thing to say to them?

We're in such a pickle right now...my poor mom is probably so sick of me calling her every other day with our new "plan" of attack! There's so much more to deal with besides the house, which is why I think walking away is the best thing but we have a lot of "what came first the chicken or the egg" dilemmas to work out first. Ugh!

[helpinNE]

I will share my .02 cents.
You might want to consider listing your house just so that you can tell the lender (and any future judge if it gets that far) that you at least tried to sell the house. Doen't mean you have to hire the most agressive agent or hold open houses every weekend, it just shows that you are trying to midigate your and the lenders losses. That being said, short sales are hard to actually get close, it may be a little easier since you have only one lender but not always.
It is anyone's guess if the banks who can go after people for DJ's will. My sense is they will write the debt off and then sell it for pennies on the dollar to a collection agency who will then attempt to collect from you. I would recommend at least meeting with a lawyer skilled in real estate and debt collection to get a clearer picture of IL foreclosure laws and you potential liability. The money you send for one meeting will go a long way to putting your mind to rest about the possible outcomes.
As for taking the persons name off the title if they are not on the loan, I think this is just a way of making doubly sure the 'innocent' spouse is not in any way associated with the foreclosure. It is a document I think you can file at your Register of Deeds Office yourself.
Hope this answers some of your questions.