Thinking about Walking Away - Loan Modification Forum

Serginator1 · 08-11-2009, 09:49 PM

Background:
I paid $460K in 2005, it's worth $300K. The house is not in the best place, location, but I bought what I could afford. Since I live in CA the prices are over inflated or at least were. I can afford to get by on my mortgage but just don't see in paying anymore. Foreclosure sounds good and just walking away from it.
I just dont think its worth it anymore. Ideally a loan mod so we can get the mortgage principle down.
More info: 1st 392K @ 6.5% IO = 1450
2nd 65K @ 7.5% IO = 400
insurance and taxes = 500
total = 3350/ month
I had to refinance the house in 2006, when I came to the conclusion of how I had been duped by my agent and broker, into a house and a mortgage that was not in my best interest, but who had told me that this was the best that I would ever get.(I should have gone with the gut feeling).
If I walk away I will have to pay 1099 taxes for the difference of sale to actual but also I will need advise on the second loan, and wether the creditor will work with me for a percentage of the total amount and if so what is the current % that I should negotiate for.
Questions: can the second creditor go after my assets?
If I have investment property can they go after that and place a lein?
Can I do this process without joining some service that will walk me through the entire process.
Any help would be greatly appreciated.

AZ Meltdown · 08-12-2009, 09:09 PM

Hi

Read up there are lots of others here with a CA story. Your liability depends on if the loans were purchase money, and believe the refi complicates that.

As to a principle reduction, basically NO ONE has gotten one, ditto on Deed in Lieu.

So your possible options are short sale, loan mod W/O any principle reduction or walking away.
If your loans are non recourse, walking away and hopefully getting a bit of Keys for Cash tends to be most peoples choice.
It was mine.

Good luck and welcome aboard.

Serginator1 · 08-12-2009, 09:52 PM

How do you know if a loan is nonrecourse. I have 2 loans refinanced both should be nonrecourse? In your case what did you do, I live in CA, does anyone have any advice on what immediate steps to take?

knownick · 08-12-2009, 10:11 PM

You could probably start by watching The Professor's video on deficiency judgments and recourse/non-recourse loans in California. I think that will answer a lot of the questions you have.

Shay's Video Presentation - California Deficiency Judgment Potential

AZ Meltdown · 08-14-2009, 08:08 AM

Quote:

Originally Posted by Serginator1

How do you know if a loan is nonrecourse. I have 2 loans refinanced both should be nonrecourse? In your case what did you do, I live in CA, does anyone have any advice on what immediate steps to take?

I read this forum, paid an attorney to make sure and walked away!
I am in AZ had a refi but no HELOC, so it was clearly nonrecourse.

AZ law is a bit more clear than CA's.

jcash12345 · 08-19-2009, 07:24 PM

That video link isnt working on my Mac. Any suggestions?

knownick · 08-19-2009, 10:13 PM

Instill the Flip4mac plugin from this page and Quicktime will play WMV files:

Windows Media® Components for QuickTime

jcash12345 · 08-20-2009, 02:32 AM

Thanks for the help.

08-11-2009, 09:49 PM	#1 (permalink)
Serginator1 Junior Member Join Date: Aug 2009 Posts: 3 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Thinking about Walking Away Background: I paid $460K in 2005, it's worth $300K. The house is not in the best place, location, but I bought what I could afford. Since I live in CA the prices are over inflated or at least were. I can afford to get by on my mortgage but just don't see in paying anymore. Foreclosure sounds good and just walking away from it. I just dont think its worth it anymore. Ideally a loan mod so we can get the mortgage principle down. More info: 1st 392K @ 6.5% IO = 1450 2nd 65K @ 7.5% IO = 400 insurance and taxes = 500 total = 3350/ month I had to refinance the house in 2006, when I came to the conclusion of how I had been duped by my agent and broker, into a house and a mortgage that was not in my best interest, but who had told me that this was the best that I would ever get.(I should have gone with the gut feeling). If I walk away I will have to pay 1099 taxes for the difference of sale to actual but also I will need advise on the second loan, and wether the creditor will work with me for a percentage of the total amount and if so what is the current % that I should negotiate for. Questions: can the second creditor go after my assets? If I have investment property can they go after that and place a lein? Can I do this process without joining some service that will walk me through the entire process. Any help would be greatly appreciated.

08-12-2009, 09:09 PM	#2 (permalink)
AZ Meltdown Senior Member Join Date: Apr 2008 Posts: 129 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Thinking about Walking Away Hi Read up there are lots of others here with a CA story. Your liability depends on if the loans were purchase money, and believe the refi complicates that. As to a principle reduction, basically NO ONE has gotten one, ditto on Deed in Lieu. So your possible options are short sale, loan mod W/O any principle reduction or walking away. If your loans are non recourse, walking away and hopefully getting a bit of Keys for Cash tends to be most peoples choice. It was mine. Good luck and welcome aboard.

08-12-2009, 09:52 PM	#3 (permalink)
Serginator1 Junior Member Join Date: Aug 2009 Posts: 3 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Thinking about Walking Away How do you know if a loan is nonrecourse. I have 2 loans refinanced both should be nonrecourse? In your case what did you do, I live in CA, does anyone have any advice on what immediate steps to take?

08-12-2009, 10:11 PM	#4 (permalink)
knownick Senior Member Join Date: Apr 2009 Posts: 130 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Thinking about Walking Away You could probably start by watching The Professor's video on deficiency judgments and recourse/non-recourse loans in California. I think that will answer a lot of the questions you have. Shay's Video Presentation - California Deficiency Judgment Potential

08-19-2009, 07:24 PM	#6 (permalink)
jcash12345 Junior Member Join Date: Aug 2009 Posts: 2 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Thinking about Walking Away That video link isnt working on my Mac. Any suggestions?

08-19-2009, 10:13 PM	#7 (permalink)
knownick Senior Member Join Date: Apr 2009 Posts: 130 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Thinking about Walking Away Instill the Flip4mac plugin from this page and Quicktime will play WMV files: Windows Media® Components for QuickTime

08-20-2009, 02:32 AM	#8 (permalink)
jcash12345 Junior Member Join Date: Aug 2009 Posts: 2 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Thinking about Walking Away Thanks for the help.

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