Upside down loan- Bailout

[aquadec]

Hi there,

I bought a condo in Southern California for 500K in 2005 on a 2 yr ARM. Its currently valued at approx 440K. However the interest rate is around 9.6 % and may go up again in 5 months.

I lived in the condo for 15 months and moved out of the US in 2006 and the unit has been rented since 2006. However, the rent is less than 50% of the mortgage.

I am not behind in my payments, but see no point in throwing good money after bad and want to stop making payments once my tenants lease expires and I have them move out. I intend to reside in the UK or Ireland

I want to walk away from the house. Is it as simple as stop making payments and sending a letter to the lender stating that I can no longer make payments and sending them thehouse key?

I have no asentimental ttchments and I purchased it as an a investment and want to walk away, now that it has gone south. Is this possible?

Thank you.

[Moe Bedard]

Hi aquadec,

Welcome to the forum and thank you for joining............

It wouldn't necessarily be that easy..........this isn't your principle residence as you moved out of it and out of the country.......
so that might remove you from the protection of California Code 580b but you would have to read up on it.........if you want more information on that go to the "Are You Going To Walk Away" section of the.........there is alot of info on that ruling there.......


In California, lenders most always choose to foreclosure non-judicial, which means they handle their foreclosure business outside the court process. In order to obtain a deficiency judgment, your lender would have to go back into court and re-file a lawsuit and chase you down.

Right now there are millions of people just like you. It is not cost effective to go after all these people when many have really nothing to go after as far as assets and cash.

Can they? Yes. Will they? Most likely not.


To see what the liability could potentially be for you...........you would need to consult with an attorney familiar with tax law........