Foreclosure next door (negotiating, price, rent, value)

[bentlebee]

Just watched the Today show and they mentioned even more foreclosures are to come since home owners who can pay for their mortgages are walking away since in their opinion it doesn't make sense to pay a mortgage based on a higher value which isn't there at this moment. I really hope in these cases people get punished on their credit score or otherwise because they are helping the home value in their neighbor hoods go down even more. The government shouldn't have interfered and have home owners solve their own mess. Now it's going to snow ball even more if normal paying home owners are going to stop paying to just get out of there house and buy a cheaper home.

[HEATHER72]

[quote=bentlebee;3071000 The government shouldn't have interfered and have home owners solve their own mess. Now it's going to snow ball even more if normal paying home owners are going to stop paying to just get out of there house and buy a cheaper home.[/QUOTE]

The ones who pay their mortgage on time and consistently should be rewarded rather than those who decide not to pay their mortgage. You can't tell me that many people didn't know what an ARM was.

[KCfromNC]

Originally Posted by MotleyCrew

We are watching the short sale wars across the street from us. One is listed a little higher than the one next door to it. They are both way below market and it is hurting the people trying to relocate and not in trouble. If you could, I would just wait until this mess is settled then move. Try renting your home if you have to leave.

Two things to worry about with this approach.

1. The most likely way to fix a problem with oversupply and/or lack of demand is to have prices go down. When the market stabilizes, it may very well be at a significantly lower price.
2. The last big RE slowdown in the US took 6-8 years to play out. While you can never count on history repeating itself, it would be wise not to ignore the past completely.

[dogmom]

Are people so stupid as to walk away from a home just because the value has dropped. If you can make the payment, there are too many advantages to home owning that I think the majority have not thought about.. for one, there is still the tax benefits, two, if you aren't making a mortgage payment, you still have to pay rent somewhere, and why make someone else rich? It's getting harder and harder to even pretend to be optimistic in this market..what the heck is going on...is it a panic?

[CouponJack]

I don't get it.

People buy and finance new cars all the time and the "value" drops as soon as its driven off the lot. But people still make the payments...

If it were me, I wouldn't let people get away w/it if they don't honestly exhaust all their options to pay what they signed up for.

[bentlebee]

Originally Posted by HEATHER72

The ones who pay their mortgage on time and consistently should be rewarded rather than those who decide not to pay their mortgage. You can't tell me that many people didn't know what an ARM was.

I'm fro Europe and understood that an ARM is dangerous and can course a lot of problems, so I guess people who were born here should get it too, but not everybody is that open to listen to advise and follow at least some good news programs on which there were warning people not to do it.
If people are walking away IMO there should be a penalty for getting others in trouble too.
Today there was another article about HOA issues and why some communities have a lot of debt. This because so many home owners don't pay their HOA dues and other people have to pay more. Many HOA have a contract with cable companies and if 10% of the community isn't paying because they are having a short sale or having foreclosed on (banks usually are not paying the HOA fees, because it is hard to get to he right person to have the bill presented), so the other 90% have to come up with the money and the percentage is only going up on the side of non paying home owners causing issues for the good home owners and having their value going down the drain.

[cjones15]

Originally Posted by haberstroh

Here is another solution you might consider (although not like it): Have a long distance relationship. We have done that last year when my husband was transfered from NJ to MA. We were separated for 9 months and only saw each other on the weekends, sometimes skipping one. We did that not to sell the house but to finish the school year.
Friends of us did the same for 1 1/2 years from AZ to MN because they could not sell their house. It is extremely painful when it lasts this long but we and they managed. Probably due to the fact that we were both former Army wives and used to separation from our husbands ;-).
I feel for you!

We will be doing a long distance relationship. My husband has to start his job in 3 weeks. My husband will only be able to come back once a month. My husband is very involved in our kids lives and him not being around is a big concern. The average home around here is on the market 6 months before it sells. We knew this so planned on being apart for at least that long.

[cjones15]

Originally Posted by Philip T

The job (still three weeks away), may totally evaporate by mid-Summer. Big companies and profitable operations are no longer surety of long-term employment. Even companies that are making good money walk out of the US for a little money more in Mexico or China. j

mho, but I would not want to drag the kids across the countryside based on (what in America, anymore is) a short-term job offer -- unless you all really, really want to be living in that new area. Not saying the job might not last for years, but do not count on it.

Our option was for him to either take the new job or be unemployed! Taking the new job was the only choice. The new job is very stable and we have no concerns of it evaporating. We have no reason to stay in the town we are in currently. There are no jobs for my husband (aerospace engineer) and our family is in a different state. We have no ties to this area at all.

[bentlebee]

I wish you all the best and hopes everything will work out as you want and if not you can always decide to rent it out.

[cjones15]

Thanks to everyone who has replied. We know this is a horrible situation but are trying to make the best of it. As for the short sale, it never showed up on the comps that were ran. We looked over them and it wasn't listed. It was a shock to all of us. Our agent did try to look up the foreclosure next door but it isn't showing up either. I don't know how long it normally takes but it's been approx 5 days. I don't know when she officially turned it over to the bank.

I really do appreciate everyone's imput. I blame everyone for all these foreclosures/short sales. When my husband graduated college we were pre-approved for a mortgage. The amount they approved us for was crazy considering he had just graduated. There is no way we could pay that much. We were smart enough to know that!!! The mortgage companies helped people get into these situations but it doesn't take a very smart person to figure out how much of a house payment you can truly afford. The people knew what they were getting into when they signed the papers. It just aggrevates me!!