short sale or foreclosure

[cute101]

hi,I need help on deciding on what to do with my investment property, I cannot afford it anymore bec im upside down i have 3 mortgage on this property first loan at cw (neg arm), heloc at cw and another line of credit at WAmu.i currently have a tenant on the proprty and their lease ends on nov.i was nt able to pay the property tax .cause last year was a tough year for us 2 family member passed. and my renter left so for almost 3 months i have to pay the mortgage,insurance, homeowner etc..my question is if i shortsale the house do i still need to pay the IRS and will the WAMU go after us to pay the 2nd. nd if i foreclose it what are the consequence when can i start the process bec of my tenant due lease on Nov. Do you think i need an atty for my situation.by the way,the rent is not enough to cover the bill,im paying out of pocket the homeoeners,insurance and the heloc at wamu thats why its cannot afford to keep the house anymore.I was so stupid being in this kind of mess.by the way,i borrowed money to use for downpayment for another investment prpty.pls help need your advise.

[Moe Bedard]

cute101,

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

What state are you located in?

The only assistance I can give is to show you the foreclosure laws for your state.........this is a very sticky situation and you have alot of legal questions that you need answers to, you really would need the help of an attorney to help you sort it all out and also to help you make the best decision for you..........as we are not attorneys we wouldn't be able to advise you on this........

[cute101]

thank you .im fr. California.Do i have to try to short sale the house and ask the lender (First and 2nd mortgage ) that i want to short sale it or can i just foreclosure it without hiring an atty.how does it work?thanks

[Moe Bedard]

Because it is an investment property the 580b rule in California doesn't apply....

This was just posted by Moe in another members thread......it applies to your situation as well.........

In California, lenders most always choose to do 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.

[cute101]

hi,im still confused but right now i have an offer fr. an investor to do short sale on my investment properties.i dont know if it is better than foreclosure ,i know it will be ,on my credit report, but again im concerned to pay the IRS if i pursue with shortsale ,probably i still dont understand the impact bet. the two in terms of paying the govt and deficiency judgement. Now i have the chance to shortsale the properties but scared to death to make another mistake. im upside down .and i wanted to start all over again. Somebody pls give me advice whoever had this kind of situation. really need help.thanks.

[Moe Bedard]

For this situation you really need to speak with an attorney for the impact that it will have on credit, and taxes, and such..........
We can't post legal advice on the forum........as we are not attorneys.....

sorry.....