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If you have any problems with the registration process or your account login, please contact us. | General Discussion Discuss House is worth half whats owed....advice? in the InfiniteCredit Community Central forums; I have a friend in Northern California who owes about $600,000 on a house she tells me is worth about $300,000. I had no idea it was that bad.
She ... 
07-27-2008, 10:29 PM
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#1 | | Elite Member
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| House is worth half whats owed....advice?
I have a friend in Northern California who owes about $600,000 on a house she tells me is worth about $300,000. I had no idea it was that bad.
She needs to move.
What will happen if she just walks away from the mortgage and allows it to foreclose? | 
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07-28-2008, 01:04 AM
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#2 | | HONORED GUEST
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| Re: House is worth half whats owed....advice?
Quote:
Originally Posted by spinn  I have a friend in Northern California who owes about $600,000 on a house she tells me is worth about $300,000. I had no idea it was that bad.
She needs to move.
What will happen if she just walks away from the mortgage and allows it to foreclose? | Anyone with a subprime mortgage should wait to see what Congress is going to do to help them. While I do not agree that anyone not understanding their mortgage terms should be helped, alas, it will not be up to me.
__________________ Please be advised that I am not an attorney and nothing I post on this forum should be construed as legal advice. Let's Go Mountaineers!! Let's Go Drink Some Beers!! | |
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07-28-2008, 04:08 AM
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#3 | | Administrator
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| Re: House is worth half whats owed....advice?
Is she insolvent? The debt owed, is it from a primary mortgage or, are there seconds or thirds?
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The information and materials in this document are provided for general information purposes only and are not intended to constitute legal, accounting or tax advice or opinions on any specific matters. Laws and regulations change frequently and their application can vary widely based upon the specific facts and circumstances involved. You are responsible for the applicability and accuracy of Information as it relates to your specific situation. | |
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07-28-2008, 09:21 AM
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#4 | | Elite Member
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| Re: House is worth half whats owed....advice?
It is not a subprime mortgage....she seems to make decent money but never should of qualified for a loan of this amount..
This is the primary mortgage.
She is getting married and simply will not pay $300,000 to sell her house. A moral issue but I can not say I disagree with her. | |
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07-28-2008, 12:21 PM
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#5 | | HONORED GUEST
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| Re: House is worth half whats owed....advice?
Quote:
Originally Posted by spinn
She is getting married and simply will not pay $300,000 to sell her house. A moral issue but I can not say I disagree with her.
| IMHO she should rent the house out and keep making her mortgage payments. The market will have to reverse sometime. Walking away won't make things any easier for her in the long run if she makes decent money and can afford to continue to pay.
__________________ Please be advised that I am not an attorney and nothing I post on this forum should be construed as legal advice. Let's Go Mountaineers!! Let's Go Drink Some Beers!! | |
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07-28-2008, 03:52 PM
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#6 | | Administrator
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| Re: House is worth half whats owed....advice?
Since she is not insolvent, she could receive a 1099 for the difference in what the mortgage holder sell the house for. Depending on her tax bracket, she could be faced with a Federal tax bill for an extra $40-60,000.
Or, a judgment for the balance.
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It is better to keep your mouth shut and appear stupid than to open it and remove all doubt. - Mark Twain
The information and materials in this document are provided for general information purposes only and are not intended to constitute legal, accounting or tax advice or opinions on any specific matters. Laws and regulations change frequently and their application can vary widely based upon the specific facts and circumstances involved. You are responsible for the applicability and accuracy of Information as it relates to your specific situation. | |
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08-21-2008, 03:09 AM
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| Re: House is worth half whats owed....advice?
couldnt agree more with Hannah! wait for right policy and help you out! there is no other solution, if your friend doesnt want to file for bankruptcy | |
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09-09-2008, 05:24 PM
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| Re: House is worth half whats owed....advice?
You Can Try a Short sale, Is putting your home for sale and the offer is less than what you owe.The catch is that the lender will have to approve it. Right now Banks are willing to get a hit and move on. The other implication is that the difference between the sale price and what you owe will generate a 1099 so you would need to talk that with your CPA so you do not have to pay taxes. In other words the bank loss is given to you as a Gain. Never accept a Short Sale that will give you a defficiency jugdment it will haunt you in the future. Hope this helps.Good Luck | |
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