Walling Away In VA - anyone?

[jdett]

This is a great site. Thanks to all.

I in an effort to get right to the point I will not tell you how I got here, but, here are the facts.

I have owed this home for 16 years. I owe 417k on the first with CW and 75k on the second with homecomings( total owed - 492K). It is worth, probably between 300k to 375k. bank owned home in my neighborhood just sold for 290k.

pmt on my first is 2800 with tax and ins. my second is 888k. Both are interest only. that is 3700 per mo total. My wife and I both make less money, due to job losses.

I can rent for 1800- 2000mo in my hood.

I stoppped paying on the second in Oct 08. I now get automated phone calls everyday.

Both lenders have been sent loan mod packages.

Here are my thoughts. I am going to stop paying CW also. Worst case, I will save 6-12 months. Rent for awhile, and then buy something cheaper in the same neighborhood. Actually, my wife is not on the loans for this house and she can qualify for an FHA loan. Hmmmmm.

I know deep down after reading this site, that neither lender is going to help, so, they can have the house. In regards to homecomings coming after me, after they release themselves from title and become an unseucred debt, I will settled with them for 10%(7,500) when that time comes.

I will never be able to pay off thsi house nor be able to sell it. I need to think of my future now that I have exhausted my IRA and now 12k in Cc debt that I never had.

My only struggle now is convincing my wife and reassuring my 2 boys that everyhting will be okay.

PS. I know of a company that can negotiate unsecured debt to 10% of amoutn owed and can get forclosers and bankrupcies off of credit after 6 months, all done legally with the FTC guidelines.

Prof, any feedback?









I ahld be

[The Professor]

My sole comment relates to your statement, "I know of a company that can negotiate unsecured debt to 10% of amoutn owed and can get forclosers and bankrupcies off of credit after 6 months, all done legally with the FTC guidelines."

Let me pointedly state that such claims, without more information about a particular borrower's situation, are not true. Each situation is different. If you were judgment proof, effectively meaning you had no assets and no prospect of having the ability to satisfy the judgment (short of buying a winning lottery ticket), I'm guessing a creditor would take less than 10% in full satisfaction. However if you recently won the lottery and had $100,000,000 in the bank, a creditor would take an entirely different view, demanding full payment.

Daniel

[cactus77727]

A company that states they can REMOVE valid negative information from your credit record is selling something. Some charge you a monthly fee and send in disputes, hoping the negative info will be dropped by loopholes and dispute response timing. It's doesn't work.

If you have legitimate disputes, or real errors on your credit report, there are methods to have corrections made. And you don't have to pay for it.

[jdett]

A company that states they can REMOVE valid negative information from your credit record is selling something. Some charge you a monthly fee and send in disputes, hoping the negative info will be dropped by loopholes and dispute response timing. It's doesn't work.

If you have legitimate disputes, or real errors on your credit report, there are methods to have corrections made. And you don't have to pay for it.

It can be done, and they do charge for thier expertise, and charge a flat fee and have a money back guarantee.

[jdett]

I am in the state of Va. If the lenders uses a non-judicial foreclosure, can they still obtain a deficiency judgment?

[The Professor]

It appears a lender can obtain a deficiency judgment after a non-judicial foreclosure in Virginia if they follow the process. See:
Virginia Foreclosure Law

Daniel

[jdett]

what is the likelyhood?

[The Professor]

In a past life I did legal work of this variety for a collection agency who took on the task of collecting on these sort of loans on a contingency basis. Lenders find it easier to simply farm out this business hopeful to receive something down the road. They find it less distasteful to farm the work out. Collection agencies are heartless and will attempt to get blood out of a turnip. So I'd say the chances are pretty darn good that they will move forward and attempt to collect after running a credit report and doing an asset search (assuming they believe after gathering this information that there is money there to execute on).

Daniel

[jdett]

Now that I have made a business decision to walk, should I do a quit claim to take my wife off of the title of the home( she is not an any of the loans)? As we save our money, would it be safe to put the monies in her acct or would that be examined as they look to go after me?

[The Professor]

Being associated with a foreclosure isn't a good thing. I think it would be in her best interests to take what ever steps insulate her from having an interest in the home. I'm purposely avoiding your other question. Financial problems are often the route cause of marital challenges. Placing your interest in an asset in the name of a spouse might cause problems down the road. Note however your home doesn't qualify as an asset because it is underwater.

Daniel

[jdett]

No need to avoid the second question. My wife and I have been together for 18 years and have been through ups and downs financially in the past. we have 2 boys (17 and 12). I just want to put my saved monies into an acct that is not readily searchable but easily accesable.

[The Professor]

Looks like you answered the second question yourself.

[jdett]

Has anyone had experience with walking away in Virginia?

[jdett]

I was told not to put the monies in my wifes acct because when the lender does a asset search they will also search the spouse. I am thinking that will not matter because by the time they do the search I will already be foreclosed on and will have bought another home in her name using the monies for down pmt.

any thoughts?