Quit Job or Lose Job = Hardship for SS?

[TrappedFL]

When a lender reviews the short sale "hardship" package, does it require that someone claiming loss of job produce documentation of the involuntary termination from the homeowner's employer?

I've felt insecure and unhappy at my job for some time, and my partner and I have been desiring to relocate closer to family. But the house I bought 3 years ago is about $120,000 upside down. I cannot rent it without a huge loss every month. I can't "walk" as I live in a recourse state. I have spoken with attorneys who told me that a short sale would probably not be approved while I have my current, well-paid job or if the SS was approved, I would be expected to pay back about 60% of the deficiency (I don't have that kind of cash but was told I would probably have to sign a note). I would like to do a short sale, and would gladly quit my current job or take a reduced paycheck if it meant I could demonstrate the necessary hardship. But will the bank require proof that my "loss of job" was involuntary?

[amiesheikh]

As far as I'm aware they never really check into that type of stuff (it would be too much work on their part). You could start looking for your new job closer to the family in the area you want to relocate to and your hardship basis could be that you are moving b/c of family support. cheaper cost of living, better job etc.

Or you could always do something at work to get yourself fired:-)

[mbmullen]

I haven't heard of a lender looking into that, either.

[Lhuynh]

from what I know bank take the loss when you do a short sale. if you were in foreclosure they have to put more effort out to sell your house.

[TrappedFL]

Originally Posted by Lhuynh

from what I know bank take the loss when you do a short sale. if you were in foreclosure they have to put more effort out to sell your house.

Not the case, hence my question. In Florida, the bank can get a deficiency judgment against the homeowner for the amount left after a home is sold at foreclosure. Therefore, the bank has the incentive to require a promissory note if it approves a short sale, if the homeowner makes a good salary and has some cash in the bank. My question is, for someone who NEEDS to move on, does it make sense to strategically reduce income coming in and how much will the bank look into HOW the income was reduced???

Desperate times call for desperate measures, especially once you've been in the home for years, home has devalued by $120,000, with nothing but depreciation ahead for years to come. AND I am relatively young and at the age where I need to start my family.

[Lhuynh]

Florida has different regulations and laws than. Have you tried to modify your loan?