Paycut, underwater and can't refinance

[banevader]

Originally Posted by 6bones9

This country is a mess...I bought a modest home 5 years ago, well within my means. I owe 145,000 on my loan and my home is now worth 105,000. I am current on my loan and have never been late. I recently took a 4% percent pay cut, and silly me, thought I might be able to take advantage of the current low interest rates to refinance my loan at a lower rate. I have no problem paying the total principal owed but needed the reduction of interset to offset my paycut. I can't get refinanced! Because I am too upside down. So I guess my options will be to walk away, and let them foreclose.

Why is walking away your first option,OP?
What about working two jobs for a while and paying your mortgage down?
Or looking for a job that will pay you what you were making?
Or MORE??

Or take in a renter?
Or sell some personal items and cut out all but the necessities

If you are married,why doesn't your spouse get another job?
Or a job if she/he isn't currently working?
Or two jobs?

There are always many options available in MOST situations.
Personally, I think that you should discuss your situation w/ a financial counselor.

[nuness]

close your accounts with these big banks, move your business to credit unions, i have done,so many others have done it, now you can do this too...
these banks make money on our money by lending, remember?

[Lynn411]

Why trash your credit? Can you not review your expenses determine where else you can cut back till market returns?

If you walk off on your home YOU NEED MOVE NOW prior impacting your credit scores. When you lease an individual property owner home based on your credit scores you may have pay double triple deposits PLUS 1st months rent.

Short Sale the property still reflect on credit report.

Think stay current contact a Realtor who can review all your options

[carolac]

Look at your budget and how you spend your money. A 4% paycut on a $50K salary, for example, is $2K a year, or $167 a month. Look at your car insurance, for example. You might be able to save one-half of your paycut by reducing your limits or increasing deductibles of car insurance. Reduce but don't eliminate your 401(k) contributions, if any. Reduce eating out by half at least. Look at what you buy on a daily basis. Cable? Gym fees? Internet on your phone? There's about $100 right there. Paying on credit cards? Get rid of them. Pay off those balances by reducing outgo of money and then apply those payments to your mortgage.

If you're distressed about being underwater, use a mortgage calculator and look at how much one extra payment on your mortgage a year does for you.

It doesn't have to be thousands of dollars a month to succeed.

Good luck.