Answers To Negative Equity Questions

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What are our options for a refinanced home in negative equity?
we bought the house in 2005 for about 590k the payments were about 5 thousand a month. due to some short income from my husband's job we refinanced the house in 2006 and the mortgage payments were then about 2000 a month but we're paying only negative equity on the house and the mortgage company sent us a letter saying that our monthly payments will rise in a few months to about 5500 without taxes! oh and the house is worth 100 thousand dollars less than what we bought it for. so we couldn't even sell it... we have no idea what to do! any ideas please.

Answer:

I'm so sorry...you don't appear to have any options...let it go...get out from under it and start over..you will need to find a place to live.....making payments now is like pouring water down a rat hole...no hope
2 years ago
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Carrie N
I hate it when people say let it go! We all have responsibilities to pay back the debts we have taken out. I would, however, encourage you to talk to your lender. Often times they are willing to work with you. When I have helped people with loan modifications I have seen lenders forgive a portion of the debt just to make the loan more do-able. The bank definitely doesn't want you to walk away!

Source(s):
www.helpwithforeclosure.blogspot.com


Peter B
If you can't imagine a scenario where you are paying enough each month that your equity is increasing, then staying there doesn't seem like a good option. So, how do you get out? You can sell your home even with negative equity doing something called a short sale. A short sale can negatively impact your credit, but it doesn't have to, and foreclosure is much worse. A short sale is something that an experienced Realtor can help you with. Call one of your larger real estate companies in your area, ask for the manager, and ask the manager for a recommendation of a Realtor that knows how to handle a short sale. You want a Realtor that will try and negotiate a satisfied the debt fully conclusion with your mortgage company. Getting a short sale approved can be difficult, so experience is key.

Read all of the source links below. Some of the articles talk about the tax consequences, but a new law H.R. 3648: Mortgage Forgiveness Debt Relief Act of 2007 should protect you from this.

Good luck.
Source(s):
http://homebuying.about.com/od/4closures…
http://www.voiceofsandiego.org/articles/…
http://www.mortgagenewsdaily.com/wiki/Sh…
http://www.bankrate.com/brm/news/real-es…
http://www.realtor.org/rmomag.NSF/pages/…
http://www.govtrack.us/congress/bill.xpd…