Need Advice: The way Forward Loan reset 2010

[john123]

To make a long story short

Loan: 350K
Loan type: 80/20 Loan 5 year I/O

80% loan resets: 2010 year = Tie to 1 year LIBOR Rate
20% loan resets: 2020 year = Tie to (Not sure but will payoff this amount before 2020 I hope )

Current market value is 225K a lost of -125K and probably falling.

In 2005 I was pre-approved for a 800K 5 year I/O loan ... (And thank god I didn't go all the way! I thought to myself 800K is to much for one person at the time) ... Today I'm making 50K more then I did in 2005 so financially I'm doing okay and I can manage the payment increase if the 1 year LIBOR Rate doesn't jump up to over 10% but I wasn't planning to stay in my condo over 5 years.

Is there anyway I can get out of my condo?

Would Short Sale be an option for me? Can this be done by taking a personal loan out on the 20% and short sale the 80% loan?

Short Sale will be on your credit record for 4 years?

Or I can rent the damn place out and take a hit per month

Idea's ????

[schwefls]

Hi John welcome to our forum:

I wanted to stop in and say hello. Shortly someone will be reaching out to you with some sound advice/suggestions.

[Moe Bedard]

Hi john123,


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


Who are the lenders on the loans?
What state are you located in?

[john123]

Originally Posted by *** Damiano

Hi john123,


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


Who are the lenders on the loans?
What state are you located in?

Both loans are with Citi

State: in Virginia near Washington DC

[Moe Bedard]

You would need to contact Citi to see what options are available to you as it would depend on the investor on the loan.........short sales are given in extreme hardship situations after all other workout options have been pursued but denied........

Please keep us updated on your progress.......

[john123]

Then I don't think I'm qualify for Short Sale if the precondition is "extreme hardship" and that probably means you have miss a few monthly payments. Why did I get promoted and why is my credit score is above 700, LOL ...

I guess I have to hope that in 2010 the "1 year LIBOR Rate" doesn't go up 10% + Margin.

[Moe Bedard]

You would have to contact Citi with the contacts I gave you to see what options are available to you from the investors on the loan.......they might be able to do a short sale, but you won't know unless you contact them and ask.............

You might also want to see if you can qualify for the new FHA plan which will begin October 1st. Although it will be voluntary from the lender standpoint, if they are willing to work with you it could put you in a better position to see what your next move should be.

Here are the prelims............

http://banking.senate.gov/public/_fi...ActSummary.pdf