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Old 01-29-2012, 06:41 PM
 
5 posts, read 13,749 times
Reputation: 11

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My wife and I are preparing to send our first child to kindergarten and would like to move from our home to switch school districts.

We're upside down on our home in Missouri. We owe $385k and it's worth about $315k.

Would it be possible to move and transfer our negative equity to another home? We both have credit scores a touch over 700 with no negative history, including our mortgage. Our income is solid as well.

Any thoughts on whether this is even possible? We currently have an 80/20 loan with Wells and a local credit union.

Thanks!
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Old 01-29-2012, 06:44 PM
 
Location: NJ
17,579 posts, read 38,288,152 times
Reputation: 16098
You may want to post this in the mortgage sub forum.
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Old 01-29-2012, 06:58 PM
 
Location: Needham, MA
6,324 posts, read 9,023,459 times
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I'm no mortage expert, but I'm pretty sure if you could do this we wouldn't see so many people short selling their homes across the country.

As far as I know you have two options:

1. A short sale which you'll need bank approval to do and will hurt your credit.

2. You can show up at the closing with $70K to pay off the difference. I'm sure there is some sort of personal loan vehicle you could use to get that money if you don't have it.

Either way, I think you should talk to your lender.
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Old 01-29-2012, 06:59 PM
 
5 posts, read 13,749 times
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Thanks. Will do.
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Old 01-29-2012, 08:52 PM
 
Location: Up above the world so high!
45,270 posts, read 86,025,648 times
Reputation: 39664
Quote:
Originally Posted by gilmores33 View Post
My wife and I are preparing to send our first child to kindergarten and would like to move from our home to switch school districts.

We're upside down on our home in Missouri. We owe $385k and it's worth about $315k.

Would it be possible to move and transfer our negative equity to another home? We both have credit scores a touch over 700 with no negative history, including our mortgage. Our income is solid as well.

Any thoughts on whether this is even possible? We currently have an 80/20 loan with Wells and a local credit union.

Thanks!
Sorry, no, this is not possible. You owe your lender a lot of money. He is not going to let you out of that.

Getting a new home requires getting a new mortgage, and with this kind of debt you will not qualify.

Your choices are...

Stay in the home

Find a renter to pay you enough rent to cover your mortgage

Sell it for the $315,000 and make up the rest you owe to the lender out of your own pocket.

Or, walk away from the home - which will ruin your credit and keep you from getting another loan for years.
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Old 01-30-2012, 07:25 PM
 
Location: Lexington, SC
4,281 posts, read 10,284,194 times
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All of this based on your nipper attending a better kindergarten?
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Old 01-30-2012, 07:33 PM
 
3,576 posts, read 5,902,769 times
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Quote:
Originally Posted by accufitgolf View Post
All of this based on your nipper attending a better kindergarten?
Yes. People think this way.

My brother just took a 300k lost. Yes. He brought for $1million in 2005. And sold he beautiful home for $720k plus real estate fees. Means over $300k lost.

He didn't like the schools district his daughter was to attend. His daughter is 4 years old now and will turn 5 in September.

So he sold and buying another $1million dollar home 7 miles away. Supposedly he says this new home would have cost him 1.3-1.4 million at peak prices. Whatever.

I tried to talk him out of it but his wife was adamant about not putting their daughter in a poorer performing school. Private school would have been cheaper than taking a $300k hit.
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Old 01-31-2012, 05:44 AM
 
5 posts, read 13,749 times
Reputation: 11
Quote:
Originally Posted by accufitgolf View Post
All of this based on your nipper attending a better kindergarten?
I have two kids, one that will be in kindergarten this year, and one next year. the year after that, they'll be in first grade, then second, etc. it's not just for kindergarten.

we've been in our home for 6 years and our school district has gone downhill. we're hoping to give our kids every chance to be successful, including improving their environment in a better school district.

thanks for all the replies everyone.
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Old 01-31-2012, 06:07 AM
 
5,463 posts, read 5,781,296 times
Reputation: 1803
Quote:
Originally Posted by lovesMountains View Post
Sorry, no, this is not possible. You owe your lender a lot of money. He is not going to let you out of that.

Getting a new home requires getting a new mortgage, and with this kind of debt you will not qualify.

Your choices are...

Stay in the home

Find a renter to pay you enough rent to cover your mortgage

Sell it for the $315,000 and make up the rest you owe to the lender out of your own pocket.

Or, walk away from the home - which will ruin your credit and keep you from getting another loan for years.
Add :
stop paying the mortgage and use that as leverage to try to negotiate a short sale with your lender
sit tight and see how the various ideas for principal reductions shake out

Not that I recommend either, but they're alternatives to consider
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Old 01-31-2012, 09:14 AM
 
Location: Chicago
3,260 posts, read 4,504,271 times
Reputation: 3990
What is to stop someone from renting their house out and using the rent to cover the mortgage while meanwhile buying the house they really want? Once the have the new house, just stop paying the mortgage on the property rented out?

Obviously, this is morally wrong, but it is exactly what my former next door neighbors did. The house was sold as a short sale after they had their new house and decided not to pay for the old one anymore.

A person doesn't need a great credit score to live a cash lifestyle.
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