Florida Short Sale - do not know what to do

[Kimatw]

I own a condo that is an investment property. I bought it 5 years ago as an investment, but wanted to move into it in the future. I ended up getting married and buying a house and now have to keep up both properties. I was breaking even on the condo until my mortgage increased and my HOA fees increased 125% plus they added a special assessment. So I have been $1000 in the whole each month for the past 7 months. I cannot do it any more. I have an interest only ARM loan, which increases next year. I put the property onthe market to do a short sale, got a buyer and went through the approval process with the bank. I bought the property at $175k and owe about $173k and we are selling it for $100k. Here is the kicker, my bank is EMC and they accepted the short sale, but I have PMI also. The PMI company wants me to sign a promissary note with them for $35k for 10 years at zero percent interest.
Is this normal and is it a good way of getting out of this property? What is the benefit of doing this verses foreclosing or a deed in lieu? Please help. I need to make up my mind on what to do!

Kimatw

[mustangpg]

Have you asked for the buyer to raise their offer? Maybe they would be willing to offer more?

[Kimatw]

We have done comparables one those selling like mine in my area and it is so bad that some are selling less than mine or at the same about as mine with more sq footage.

[mustangpg]

Did the BPO come in at the buyer's offer price?

[Kimatw]

We had one last time we had a sale about a month ago. The lending fell through for the buyer and the sale price was $105k The mortgage company said they valued it at $90k and would not take less then that. Not sure this time yet. I should know in a week.