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Another walk in WA, IndyMac 1st, Wells 2nd

Discussion in 'Deed in Lieu of Foreclosure - Do You Need Help to ' started by WAWalker, Jan 23, 2012.

  1. WAWalker

    WAWalker LoanSafe Member

    So I have been doing what most seem to do on this site which is read, read, read. And then read some more. After consuming as much material as I can, I have decided to post my story in hopes that others in a similar situation can use this thread to help them decide how they may approach their own situation.

    I purchased a condo in the Seattle area in November 2007. The purchase price was ~$230K with 10% down and an 80/10 split with IndyMac holding the 1st 5/1 ARM at 6% and Wells Fargo holding a HELOC for the 2nd at with a variable rate. Both loans are purchase money. $185K owed on 1st and $23K owed on 2nd. Property worth ~$120K based on most recent sale in complex.

    I moved to NY for a job and have been renting the condo out for a few months and carrying a roughly $700/month loss to keep the loans current. That is going to end as of February 2012. That is when I will stop making payments on both loans. Based on information from the boards I will continue to pay the HOA dues. I have set up a Google # and have updated my contact information on both sites. I will be sending a letter to end any phone calls as I have no interest in attempting to keep the property.

    The ideal outcome for me is to have the process end as quickly as possible. I no longer live in the state and do not plan to HAMPSTER in order to add more time to the process. After reading many posts the outcome of SD vs. DIL vs. SS are the same so I want to move on as fast as I can and get this behind me. I know that my credit will take a nosedive. I am trying to accept the fact that a lifetime of working hard to build and maintain good credit will be gone in a matter of months but I'm not sure I see an alternative.

    There are a few questions that I have been wondering about:

    1. Do I tell the renter that they may receive notices on the door and mail regarding the impending foreclosure?
    2. The lease is up in April. Should I just tell them that I cannot renew the lease and leave the place vacant? I would like them to stay on a month to month lease, possibly at a reduced rate due to them having to deal with notes/people at the door. Any thoughts?
    3. Why didn't I do this sooner?

    Thanks for your thoughts and I will keep this thread posted with any activity that occurs.
  2. Evan Bedard

    Evan Bedard Call 1-800-779-4547 Loan Safe Mortgage

    Welcome to the community WAWalker.

    It seems you have gone a great deal of reading around here and know the necessary steps it takes to begin your walk away.. This definitely seems to be the most logical solution as there are not really any benefits taking a $700 monthly loss. We have a lot of members here who have also decided to walk away from their WA home and are also documenting their walk as they go.

    I would definitely keep your renter informed that you are struggling to make your monthly payments and that the property is going to go into foreclosure. They can easily have 6+ months before a foreclosure date is finally set. You can reduce their payments if you would like and a month-to-month lease agreement would be suitable for your situation. Remember you're not alone there are many people here in the same situation as yourself..

    Here are some threads with other members like yourself walking away in WA state.

    Calling all Washington Walkers! Lunch 1/29 Sunday **RSVP HERE**

    In Washington - Is walking away doable?

    Walking in WA - Questions about judicial foreclosure, abandonment and primary residence

    Hoping to walk away in WA - BECU loan

    Walking away, my strategic foreclosure in North Seattle, Wells Fargo (refinanced)

    Joining the club: Strategic default in Seattle, WA.

    These Boots are Made for Walkin'......... In Washington

    Foreclosure in Washington State
  3. WAWalker

    WAWalker LoanSafe Member

    Thank you for the consolidated links to so many forums. I have been searching but this is a very comprehensive list. This board has been a tremendous resource for me and I am very glad that I was able to find it. It was instrumental in helping me make my decision.

    Thank you for the comment on notifying the renter. I wasn't sure how to handle it but I will communicate to him about the issues with the condo. If I were in his shoes, I would like to know so I think I should do the same. In return for a few notices on the door, he gets discounted rent and I don't have to worry as much about the property.

    I haven't seen many threads about IndyMac in WA and I don't know if that's a good thing or not. Again, thanks for the response and I'll keep the thread updated as the process continues.
  4. Evan Bedard

    Evan Bedard Call 1-800-779-4547 Loan Safe Mortgage

    I'm very glad to hear the forum has helped you make your decision and has been a valuable source for information.. There is a ton of threads and various topics here but you can always find others going through the same thing in your state. You can use the search bar at the top of the page and type in specific details of information you are trying to find and it will locate threads for you that pertain to that topic.

    And it's good to keep your renter up to date on what is going on so they do not panic when they see a foreclosure notice come to the property.. If anything it is a bonus for the renters as they can easily have 6+ months of reduced payments and get to remain in the home until it goes into foreclosure.. You will get notices about when exactly the foreclosure is going to take place so you will have plenty of time to let them know so they can find another place to live.

    Thanks for documenting your story for others here as I'm sure many more will join the forum as a strategic walker in WA.
  5. WAWalker

    WAWalker LoanSafe Member

    So I just got off the phone with the agent that is handling the rental of this property and told him that I would be missing the next month's payment so he could talk to the renters if they got anything posted to a door. He was pushing the short sale vs. walking away stating that the foreclosure would make it harder to purchase a house in the future, etc. Some of his clients were able to get short sales through despite their income but I would imagine that many of them had to fall behind at one point and the damage to the credit is already done. If I could get out of this with credit intact and the bank approving a short sale I would. I think nearly everyone on these boards would like to get out of their homes with their credit intact but I don't see that happening for most. He is not one that would be listing the place so he doesn't have any financial interest in the place. I didn't go into the details about just wanting to get out of the property and not have to deal with exposing all my financials to the bank. I am just about to miss my first payment on Wednesday and am now reconsidering my initial approach.

    Does anyone think that it's worth speaking to the bank to see if they would short sell without falling behind on my payments or is silence the best option? I don't want to have to jump through a bunch of hoops to end up in the exact same place credit wise only many months and many headaches later.

    Appreciate any advice.
  6. Evan Bedard

    Evan Bedard Call 1-800-779-4547 Loan Safe Mortgage

    This is a very tough decision as no one can tell you whether or not you will be approved. In actuality it is possible to achieve a short sale without missing any payments and/or having very little impact to your credit rating. I have seen quite a few people over the last few years able to do so but you must be able to show a strong financial hardship, and the fact it is now considered a rental it may be even more difficult.. However, you do have a hardship as you are enduring a $700 loss each month on the rental and have moved out of state for work.. I would continue reading around and looking at other members experiences attempting this. Here is a link to the short sale section here in the forum:

    Short Sale Outpost
  7. Setmefree

    Setmefree LoanSafe Member

    It should always be assumed that real-estate agents (and your rentel agent) are NOT working with your best interests in mind. This is not a knock against agents. I have great respect for the profession, but it is a matter of business logic. Outcomes that lead to their happiness and satisfaction are not necessarily ones that lead to yours. For instance an RE agent would rather spend 2 years trying to sell your short sale then it entering foreclosure in 6 months. Even the smallest potential for a commission is better then a guarantee of none. Just a thought.
  8. WAWalker

    WAWalker LoanSafe Member

    Setmefree - Thanks for your input. I agree with that. I do believe that this agent is one of the good ones but he may have others in his office that may be interested in taking over a short sale. I'm sure that any listing and commission is reason enough to try.

    Evan Bedard - Thank you for the link to the forum. I will keep reviewing all the threads that I can get my eyes on. I agree that there is always a chance that it may be approved. That sliver of hope is what has me teetering on the edge. With my situation as it is, the relocation and net loss on the rental, I am still concerned that my income may be what prevents me from obtaining an approval. Many of those on the forums believe that providing so much financial information is like showing my cards in a poker game and I agree. Also, I noticed on the documents that IndyMac provides in the financial packet include the following statements:

    I certify that: my property is owner-occupied; I intend to reside in this property for the next twelve months; I have not received a condemnation notice; and there has been no change in the ownership of the property since I signed the documents for the mortgage that I wish to modify.

    This company is a debt collector and any information obtained will be used for that purpose. However, this notice does not imply that we are attempting to collect money from anyone who has filed a bankruptcy petition and there is either an "automatic stay" in effect in the bankruptcy case, or whose debt has been discharged pursuant to the bankruptcy laws of the United States.

    My property is not owner-occupied so by submitting my documentation I am not in compliance with that statement and I don't see any value in providing ammunition to any debt collector. At this point I think I need to stay the course and just try and finish this as soon as possible and begin repairing my credit as fast as I can. I should start looking at those forums now.

    Thanks again for the input. It's funny how the resolve wavers as it gets closer to reality. It hasn't felt much like reality but today my stomach is turning just thinking about missing a payment.Even though the I won't technically be late as of today, to me it's late and has me uneasy. I'm still certain that without this forum I would still be paying and trying to figure out a course of action. What a great resource.
  9. WAWalker

    WAWalker LoanSafe Member

    As of yesterday I am past the 15 day grace period and I'm not sure what I was expecting but there wasn't a sound. A heads up to any other WF loan holders, I just found out they need a form faxed to them 10 days before a payment is due to modify or cancel an existing automatic transfer. IMB didn't require any paperwork so it looks like I might get stuck paying this month's payment on the WF loan.

    After I spoke with the real estate agent again and told him that there would be no short sale the calls from him have stopped. Good news is the tenants are looking to purchase so they asked him if I would be flexible around the lease arrangement. It will work out great for both of us since they will get a month to month, which is great for me, and I get some rent and someone to take the notices off the door when they get posted. A real win/win.

    I keep my fingers crossed that I get the NOD on March 1st and the process moves along quickly.
  10. WAWalker

    WAWalker LoanSafe Member

    So I set up a Google Voice account, changed the phone numbers on my accounts, and forwarded the calls to my cell phone to deal with the anticipated calls. As of yesterday I only had three calls and was beginning to wonder if they weren't calling me at all. I logged into the Google Voice account and found out there have been 11 phone calls and they started 3 weeks ago. I have received 5 in the last two days.

    There was also a note from the postman that says I have a large letter waiting for me and $1.10 in postage is due. I'm not expecting any large letters from anyone and will not pay to receive a possible HAMP package. That's what I suspect it is but will find out this weekend when I get to the post office.

    The last thing I have received is an email from IMB that says I began a loan modification but did not finish and if I want a modification I need to log in and complete the required application. I don't plan on doing that.

    Will update again when I have some more information
  11. izzle

    izzle LoanSafe Member

  12. SeattleE90

    SeattleE90 LoanSafe Member

    I did a short sale in WA without missing any payments on both a 1st and 2nd. It did take time but It is possiable.
  13. Mee-Shell

    Mee-Shell LoanSafe Member

    I am very eager to see how your walk proceeds WAWalker. I'm also in Washington State, and we just started the process on our rental property. We're also walking from our primary residence, but it's the rental I'm more concerned about. There is so much conflicting information out there on what can happen when you walk from a rental, and I'm still not 100% on whether or not there will be any tax consequences from it.

    Here's our story in case you want to follow what's happening with our walks - These Boots are Made for Walkin'......... In Washington
  14. WAWalker

    WAWalker LoanSafe Member

    izzle - Reading your thread was a huge source of information and inspiration that it could be done. I found that reading your very detailed thread answered many of the questions that I had about my own situation. Many other users have thanked you and I echo that sentiment.

    SeattleE90 - Did you document your story in a thread? I'm sure many users of this forum would be interested in your story. I know that I personally would have been interested in it before I started this path.

    Mee-Shell - I will definitely keep this thread alive until this process finishes. My rental was initially my primary residence so it should be handled as a primary residence default. I do hope that this thread provides some valuable information for you. I also subscribed to your thread to watch your process.

    In general, there is not all that much to update. I am very glad that I used Google Voice as I have gotten quite a few phone calls and only two voicemails. There were a total of 7 calls on Friday but none of them ring through to my cell phone. I have gotten a few letters from WF and IMB stating nothing more than I'm late on my payments and to call them if I'm having trouble making my payment. I haven't received my NOD yet so I'll keep waiting for that piece of information. That's the update for now.
  15. izzle

    izzle LoanSafe Member

  16. Mee-Shell

    Mee-Shell LoanSafe Member

    Our situations are exactly the same, so this should be interesting. Our rental was originally my husbands residence. When the house next door went up for sale, he bought that one which we live in now. I wasn't sure if they would handle the first house as a primary residence because we do have renters, but it does make sense considering the paperwork was written out as a primary residence. Here's hoping!
  17. katwalker

    katwalker LoanSafe Member

  18. WAWalker

    WAWalker LoanSafe Member

    katwalker - I just recently, this month, converted them to a month to month agreement. Their original agreement is set to end in the middle of April. They are interested in purchasing their own home but he is a CPA and this is a really bad time for them to try and search for another place so a month to month will allow them to walk away quickly when they get their own home. I think that's good for both of us.

    I just subscribed to your thread. Best of luck on your walk!
  19. WAWalker

    WAWalker LoanSafe Member

    Sorry for the lack of response but work has been busy but there have been a few developments that I wanted to share.

    I have been receiving a very large number of phone calls and they have recently slowed down. Google voice shows that I have 99 phone calls since February 2nd. Of those I've gotten 5 voicemails. My credit score has gone from 763 in January to 697 as of April 5th. Pretty big nosedive but completely expected based on the experience of others on this board.

    I have gotten three certified mail envelopes that say the same thing regarding late payments and that they can help me if I contact them. Those letters have all been from IMB and not WF, although WF has been calling more than IMB. I have received a few emails from IMB stating that I began a modification request and I still have time to finish it if I would like.

    The current renters have signed a month to month agreement and I have agreed to be flexible with their move out and they have agreed to be understanding if there is anything posted on the door. I am concerned that if I try to move to another place that I will have a hard time renting due to my credit score. I was not in a position to break my lease before I started this process so in June I'll know if I'm stuck in my current place or not. It would be disappointing but not unexpected.

    That's all in a nutshell for right now. I'll post again when some more activity occurs.
  20. WAWalker

    WAWalker LoanSafe Member

    The phone calls continue and now they are happening on weekends more regularly. One interesting development that occurred was a rejection letter from a bank while attempting to open a new checking account. The letter I received stated that they reviewed my credit and wouldn't allow me to open a checking account based on my score. Has anyone else had this issue? It doesn't matter to me all that much at this point but if any others out there are planning on moving their accounts to another bank I'd recommend that it get done before your credit score begins it decline.
    Last edited: Apr 16, 2012

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