How do you go about walking away from a house? (non-recourse, refinance)
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I'm toying around with the idea still of just walking away from my house in Michigan and then plan to live in Apartments until I find a place I want to live for quite some time. I'm terrified of just walking away. I don't want to do it but I feel like it will make me happy moving out of this state instead of sitting back and watching it struggle. I also don't have a high level of job security doing contract work.
Everyone keeps telling me that if I wait about 7 years everything will be okay, but is that worth me sacrificing those years of my life.
I'm 24 and Single, I have lived in the house for a year and 1/2 and it has yet to make me happy, I do love my neighbors I could not ask for better neighbors but I know now I got to do what makes me happy not others.
First thing to do is call a realtor and find out if you can sell the home, vs walking away. If not, you simply.. walk away.. pack your bags and move.. mail the keys into the bank to the property, they get the hint..
First of all, I agree with pghquest that the first thing you need to do in this situation is to call a Realtor and try to sell your house before simply "walking away." And I might note, give it adequate time to sell, which could be several months to a year in this market.
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Originally Posted by tcb
I feel like it will make me happy moving out of this state instead of sitting back and watching it struggle. I also don't have a high level of job security doing contract work.
Admittedly, I don't live in Michigan and so I am not sure what may be going on in that state, but I am curious where you are considering moving to where you won't be "sitting back and watching [the state] struggle." Every state has issues to deal with and struggles in one way or another. If you seriously plan to move out of state, I advise you to research other areas realistically and not fall for the "grass is greener somewhere else" sentiment.
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I'm 24 and Single, I have lived in the house for a year and 1/2 and it has yet to make me happy, I do love my neighbors I could not ask for better neighbors but I know now I got to do what makes me happy not others.
I'm a little bit curious as to why you were expecting that living in a house would make you happy. I'm not sure that should be the best measurement to use for your happiness. What about hobbies, friends, career, etc.?
I do think people should do what makes them happy, but this also should be done in a responsible way. What you have outlined above, I'm afraid to say, does not sound responsible. To be blunt about it - it sounds self-centered and seems to lack an understanding of the commitments and responsibilities that you've taken on (and I hope I am wrong about that). Most people walking away from their homes did so out of financial desperation, which you didn't cite as one of your reasons. You did mention not having a high level of job security, but didn't say you are unemployed.
Just walking away? You mean not selling and just letting the bank holding the bag, so to speak? If so, that is so irresponsible and cowardly. You got yourself into it and you need to get yourself out of it. That is what is wrong with your generation...everyone got trophies-no winners, no losers. Well, guess what? This is the REAL WORLD and your actions affect others. If you are not happy, fine. You get a realtor and get a for sale sign on your home. You try and sell it. If it doesn't sell, you try and short sell it. You try renting it. But, you do not just give up b/c you are "not happy." Be a man (or woman) and have some self respect.
I do wish you the best. But so the RIGHT thing
This situation is going to happen in spades during the next 2 years.
I don't blame him. Banks gave him cheap money. He rolled the dice. It came up craps. Oh well. Like all good Ponzi schemes, he came in too late to make money.
Tough to REALLY provide any advice - depending on your loans, etc. Just remember - CA is a non-recourse state under the purchase money arrangement - if you pulled out an equity line after the purchase, or refinanced - the ball game changes. Perhaps you can post what you owe, values...
Anyone that wants to walk away is making a business decision. Anyone that says it is irresponsible, cowardly, etc. must remember - when businesses lay off 10% of their staff because times are tight - they are typically rewarded with higher stock values. So... All business, if you know that you risk to walk away is less than staying in the home, look at your potential liabilities and pull the trigger on what works for your situation.
The OP did not ask for a moral input on if they should do it.. they asked how to do it..
You are correct. And I wanted to voice my opinion on how to do it: by putting a for sale sign in the yard and taking some responsibility. If someone was asking how to make a bomb on here, would you give them directions on that too?
Oh, and so what if the bank offered him the money. People should know there own limits...It is called self responsibility. Might doesn't make right. The bank offered us a lot more (even in this market) and we KNEW that was wrong and that we couldn't afford what they were willing to give us. We didn't use the full amount-we used about $100K less. We could have bought a much bigger home and nicer, but we had a little restrain.
I'm not sure why you are considering 'just walking away'. You can rent out the house and move to where ever you want. You could try to sell. You could do a deed in lieu. You could do a lot of things. I would strongly suggest you speak with someone knowledgeable about your situation and the ramifications of how you handle it. You're only 24, inexperienced and need someone who knows about all the various alternatives so you can make an informed decision. You can't get that on a forum board.
Tough to REALLY provide any advice - depending on your loans, etc. Just remember - CA is a non-recourse state under the purchase money arrangement - if you pulled out an equity line after the purchase, or refinanced - the ball game changes. Perhaps you can post what you owe, values...
Anyone that wants to walk away is making a business decision. Anyone that says it is irresponsible, cowardly, etc. must remember - when businesses lay off 10% of their staff because times are tight - they are typically rewarded with higher stock values. So... All business, if you know that you risk to walk away is less than staying in the home, look at your potential liabilities and pull the trigger on what works for your situation.
I'm not sure I get your analogy on businesses laying off people...this is NOT a business. I mean, it is on the bank's side, but I still don't understand your point. The OP made a personal decision to own a home. Not attacking here...just trying to understand your point. And, as for the risk (your last sentence) you are saying take care of number one and do what is best for you. Can you imagine if everyone only had self serving actions. We would be in great trouble. Would you think it is okay for him to walk in and rob a bank b/c he believes it is in his best interest?
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