how do i prepare to walk away from mobile home loan?

[bigdoglover]

my partner and i purchased a mobile home on leased land in a mobile home park in 2006. the next january she died leaving me responsible for all of the debts as we both signed on the loan. i talked to the agent who sells homes in the park and he said it will never sell for anywhere near what i owe, and to treat it as a rental until i walk away and turn the keys into the bank. long story short,i used up all of the cash i had to stay here when i should have left years ago. i have prepared myself to the best of my knowledge emotionally to walk away and move in with a friend in another state. the mobile home is in illinois and i am on social security disability; so i think my only source of income is protected from the bank where we got the loan. i did just move my checking account out of that bank so they can not take any money out of it. so my questions are, when i do miss my 1st loan payment how long do i have before i need to move out? do i have a month here? what do i do to get the house ready to leave? i will notify all of the utilities like gas,electric,water and garbage that i am moving out. do i need to actually have the water turned off or will the bank do that? what about my homeowners policy, can i cancel it when i turn in the keys? do i need to physically walk into the bank and give them the keys or can i mail them certified mail? i figure after i am packed up i will do whatever i need to do as i don't want to just leave without them knowing. any help would be appreciated as i am making the last loan payment this week and will be moving in the next month or so. thank you

[RyanJP]

Good morning,

The bank will still need to go through a foreclosure process regardless of whether you hand them the keys or walk away and never speak to them again. You will have at least two months before they even think about sending you a notice of default. Just doing a cursory glimpse of Illinois foreclosure laws, Illinois has a redemption period built into the process. You will LIKELY have anywhere from 8-12 months *from your first missed payment* before you are legally no longer allowed to stay in your home. This assumes the bank doesn't delay any proceedings, and also assumes you don't fight any proceedings.

I would like to take a second to point out that I am in no way, shape or form a lawyer. I'm going off a very generic look at Illinois foreclosure laws that were posted by somebody on the internet that may or may not have known what they were talking about themselves. Here is a brief summary of the process: Illinois Pro Bono | How Long Will a Foreclosure on My Home Take?

All that being said, because you are on a limited budget, it would be to your advantage to STAY in your home until the courts say you have to get out. You will be living "rent" (mortgage) free for that time period, and allow you to build up something of a savings to support yourself on when you finally do move in with your friend.

I suggest this because even if you shut off the utilities and winterize your home, you still are responsible for providing insurance (for your own protection, in case somebody injures themselves on your property), any monthly/yearly charges the mobile home park might charge, etc. If you are paying all that money, you might as well at least stay in your home and save money on the rent, right?

[bigdoglover]

i thought mobile home loans were not traditional mortgages so the foreclosure rules did not apply to them. not sure but i think they are more like a car loan, not a mortgage. when i stop paying the loan i will also stop paying the lot rent and in no way do i know how to winterize but will be leaving in warmer weather. i figure that is up to the bank once i send them the keys. the agent i talked to at the park here said he did not know if the park would attempt to get any money from me when i vacated, only if there was any money they could get,which there isn't any. so when i do walk i will stop paying any money towards anything to do with the mobile home.

[RyanJP]

i thought mobile home loans were not traditional mortgages so the foreclosure rules did not apply to them. not sure but i think they are more like a car loan, not a mortgage. when i stop paying the loan i will also stop paying the lot rent and in no way do i know how to winterize but will be leaving in warmer weather. i figure that is up to the bank once i send them the keys. the agent i talked to at the park here said he did not know if the park would attempt to get any money from me when i vacated, only if there was any money they could get,which there isn't any. so when i do walk i will stop paying any money towards anything to do with the mobile home.

You are correct. Sorry for providing the wrong information, my brain was still thinking real property financing, not personal property financing! Stupid brain.

[bigdoglover]

so you are saying not to make this month's payment? i have to pay it by the 28th or it is late. i plan on moving out either the 1st week of april or may and just call it quits. we initially paid $73,000 and i still owe $47,000, the agent in the park said he has one similar to mine that isn't selling in the mid 20's. he said he would love another listing but not mine as it has no chance of selling anywhere near what i owe or what the bank would accept for a short sale. i figure i need to buy a new car before i ruin my credit, and moving in with a friend out of state is a done deal and will help both of us. i just don't want to get locked out with my dog and my belongings inside, thats why i keep paying until i am ready to move before the 2nd payment will be late. oh the agent also said the bank i used are buggers to deal with,great.

[bigdoglover]

so pay the loan which is a lot less than the lot rent and don't pay the park? my lot rent here is $650 a month, they won't lock me out? i guess i don't want to have my belongings and dog locked in and me outside. this stuff is scary to do, and i wish it hadn't come to this. if people think this is easy, try it once and walk in our shoes. funny how businesses do it all of the time and don't bat an eye at doing it, its just business. thanks for sharing