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Old 01-05-2009, 07:02 PM
 
9 posts, read 16,697 times
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Thanks for your help. Who should I contact first? I sent a letter of hardship to my bank along with listed monthly income and expenses, w2's, and bank statements. In the info I sent to the banks, I stated I'm collecting rent. Should I consult with a lawyer? Won't that cost me more money. I'm confused and don't know which way to turn.
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Old 01-08-2009, 02:06 PM
 
242 posts, read 650,182 times
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Originally Posted by Mike62 View Post
Hi, I bought my 1 bedroom condo in Paradise Valley, AZ on 8/06 for $175,000. I took out a 5 year interest only ARM and put 10% ($17,500) down + closing costs. I've since moved to Long Island New York because I was about to lose my job, and am now renting the condo out to someone. The rent I collect ($825 a month) doesn't cover the mortgage and Home owners association payments ($1300 a month). I don't know what to do. I was told since it's not owner occupied anymore , I'll be paying just as high a rate to refinance. I don't want to sell the condo, because I'll take a big loss.
Is it worth throwing more money at my principal balance in this case? I can't sell and take this huge loss. The $21,000 for down payment and closing costs was my entire life savings and I've been paying this all on my own.
Right now, I'm paying rent in New York and the extra $500 to cover the rest of my mortgage in Arizona. I don't know how much longer I'm can make ends meet considering I make $46,000 a year here in New York.
Any advice would be appreciated,
I would get a lawyer in that area and discuss renting out a home in foreclosure as your main interest. Find out the laws in that state.

I would stop paying on the property and collect your rent each month. With the lawyer, I would contact the tenant and inform them of what is going on and use the law to help both of you. IN ten months at 825 you get 8,250 plus save 5,000 (the 500 you spend to cover).

Working with your tenant and the bank and the lawyer, it is possible you could eventually get it sold in a short sale after ten months or so (there are still people out there thinking NOW is the time to buy).
You cannot usually bargain on the mortgage until in default.

By keeping your tenant there you keep the condo from becoming vacant. With your lawyer, you work out something with the association and taxes with the bank.

It is all you can do. You are upside down and throwing good money after bad. You are also losing sleep and gaining stress over this. You have spent all your svaings and are in deep financial trouble. This is not a 'home' issue, it is a finanacial business decision.

Getting a lawyer to do this with you will help the bank, you, the tenant, the association, and the county tax appraiser.

Read this too.
How to survive the Great Depression of 2008 - 2009
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Old 01-08-2009, 06:09 PM
 
9 posts, read 16,697 times
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thanks for the advice. Should I retain a lawyer in New York or Arizona?
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Old 01-08-2009, 06:21 PM
 
242 posts, read 650,182 times
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Originally Posted by Mike62 View Post
thanks for the advice. Should I retain a lawyer in New York or Arizona?
\
arizona.
That is the state with the house. If you do it right you can end up pretty good with everyone..

and before everyone gets all ranty on the not paying...here is something to consider.

Your mortgage is way over the real value of the home. The mortgage holder will not revalue to mortgage to, lets say 50% of what it is now.

However, they will foreclose, throw you out, and then get bailed out...by the governemnt, who will then sell it to a private firm for 30 to 50 cents on the dollar.

This is nothing but robbery by the big boys. They will not revalue your mortgage to something normal, but they will foreclose and sell it for less than the revalue would have been.

Yeap... its all our fault.
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