[LikeAStone]

We relocated to Fort Pierce, FL in July 2005 to be closer to our family.

We bought our home for $242,000. Unlike many other people, we put money down. Less than 10%, but still, we put money into the home.

5 bedroom, 3 bath, roughly 2,000 sq ft under air. Built new in 2005. Overall, a very nice home, nice neighbors, community pool, fitness center, 24-hour gated security, three lakes and a huge clubhouse.

We felt like we made a decent decision. 10 minutes to the beach...10 minutes from family support for raising our kids.

July 2005. We close on the home. Mortgage is not anywhere near too expensive. Not too much house for us. Even now, the mortgage is roughly $2,100 a month. God has been good, and we have no issue with being able to afford the house.

At closing, the home is appraised for $300,000. We were looking for a home, not a flip, so we took no interest in cashing out the equity and selling or using the equity to buy other things. We never refinanced.

In three months, it will be three years we have lived here. I am co-owner of a business and we are about to centralize our operations in Raleigh, NC and start building a bigger staff. We have employees in PA, IL and FL.

Naturally, I need to sell my home so I can move to NC. I investigated homes selling in my area and found that the extraordinarily high number of foreclosures in my area has driven the prices waaaaaaaay down.

My same model house was just sold in a short sale for $129,000. The next seven houses to the right of me are all sitting empty. Every one is padlocked and some have bank notices on the front door. There are nearly 1/3 of the nearly 500 homes in my community sitting empty. Not even able to be rented. There are huge 3,000+ sq ft homes selling for in the 140s on my street. Foreclosures mostly.

We had every intention of living here for years to come, but the business is growing and we need to centralize our core team of developers. Raleigh is a hotbed for tech firms like ours and after much research, we feel our headquarters needs to move from Chicago to Raleigh.

I get plenty of interest in my home. Dozens of inquires have come in. Not one showing. We have staged the home to sell and made lots of upgrades. It looks amazing and as soon as the prospects start investigating the area, we never hear back. Not once.

What to do? Can't get anyone interested enough to buy. We have dropped the price of the home below the latest assessed value from February 2008. It now sits on the market in the low 170s. Nothing doing. Can't sell it.

I have nearly perfect credit. My credit score is a few points away from 800 out of 830 according to Experian. The other two are even higher. I have never missed a payment...on anything.

Bank won't talk to me about adjusting the payoff of the loan down to the latest tax assessment of $180k. Even at 180k, I am looking at a $62,000 loss. At this point, the bank would be fortunate to get $130k in a foreclosure sale.

To start discussions with the bank about a short sale or deed in lieu of foreclosure, I have to miss a minimum of three payments. That will be roughly 200 points off my credit score. Snapped right off a credit score that I have spent years building by doing the right thing and spending responsibly and within my means. 200 points off my score just to TALK about the possibility of a short sale. A short sale requires a BUYER, mind you...something I have been unable to scare up. Form what I understand, even if I do find a buyer who will to take the house for say $150k, there are no guarantees that the bank will agree to write the difference off the value of my loan. I may be nailed with a summary judgement for the difference.

Short sale, foreclosures and DIL of foreclosure all slash from 250-300 points or more off your credit score. What is the difference? Who cares.

I have three options left:
1) Find my own buyer for the home and take out a loan for over $100,000 to finance the cash I will need at closing to satisfy the difference between the sale price and the loan payoff. This assumes that I can find a buyer and that a bank will give me no-collateral personal loan for over $100k. Two EXTRAORDINARILY UNLIKELY scenarios.

In this example, I will be paying the mortgage without the home for at least 15 years. Money that would go into retirement and education for my kids.

2) Stop paying my mortgage, after three missed payments I can hopefully begin negotiating with the bank for a short sale. Again, I have to find a willing buyer...and again, the bank will have to agree to swallow over $100k in a write-off of the loan. I get a 1099 for the difference between the sale price of the home and the remaining loan balance. Thanks to the mortgage debt forgiveness act of 2007, instead of having to claim $100+K in additional income for that money, like years past, the federal government will not view that money as income and I won't owe taxes on it. Since I only have one mortgage, that mortgage is for my primary residence, and I never refinanced, I qualify under the terms of this Act.

In this scenario, I still take a 200+ point hit on my credit and I have a black mark on my credit that will not go away for 7-10 years (depending on what you read). This will make purchasing another home in Raleigh...OR EVEN renting a home, very difficult and in all liklihood, impossible for many years. Lenders will certainly run my credit and landlords almost all do the same.

3) Walk away. Mail in the keys. Take the same 300 point hit on my credit that the foreclosure would take away eventually anyway. Start rebuilding my credit immediately, instead of months/years from now. The home will be sold as a foreclosure and I will get a 1099 in the mail to claim the income on my taxes. I am forgiven that tax burden by the Act I mentioned above...so that is just paperwork. Will I be able to purchase another home for my family in Raleigh, NC? Not after that 300 point credit hit...NO WAY. Will I be able to rent a home/townhouse? Almost certainly NOT. Where will we live then? Sigh.

I did everything right and on the up and up. No stated income highly adjustable ARM, no Zero-down crap...nothing but straight and narrow. But now, because it seems the bank was giving away loans to anyone who wanted one...without income verification, or requiring money down, people with bad credit and no money invested are simply walking away. Leaving people like me holding a rapidly depreciating "asset" that I am unable to sell for even 50 cents on the dollar.

I have consulted with two real estate/foreclosure attorneys. Both gave me the same advice...mail in the keys. Walk away now and start over. Bankrupcy would not even be helpful...I have ZERO other debt.

What to do? I feel I have no choice but to walk away.

Convince me I am wrong.

[MrTudo]

Bye bye, have a nice trip to north carolina.

Be glad you don't owe me the money. There would be no place for you to hide. You would be made to honor your word and commitment no matter what way you tried to weasel your way out of it.

[Huckleberry3911948]

a house, a car, a stock, are not a lose til the sale occurs.

[desertsun41]

So many of us are in the same boat. You are not alone. Could this be the crash that burries America? Convince me otherwise.

I see this housing crunch for another 10 years at least. All these people walking from their homes. All these people paying but falling behind. All these people with bad credit now through no fault of their own. They won't be buying another home in 7-10 years. That is a lot of people culled from the buyer pool with no end in sight with all the for sale signs.

Sorry I have no answer for you. Where I am we have more forclosures then you. Records show that one out of every 13 homes are in some stage of foreclosure in Las Vegas. So hard to believe after 5 years of 10% a month gain which was the fastest in the history of America. We rose the fastest and we fall the hardest.

Even if this is not the crash that burries America. One thing is for sure. The rich will get richer and the poor and the middle class will get poorer.

[desertsun41]

Originally Posted by MrTudo

Bye bye, have a nice trip to north carolina.

Be glad you don't owe me the money. There would be no place for you to hide. You would be made to honor your word and commitment no matter what way you tried to weasel your way out of it.

Ain't you the top contributor for the day.

I forgot to mention. To the OP: You are not the first post like this. The majority of num nuts will slam you so hold on. But dont worry, you did nothing wrong. They are all just a bunch of ungratefull idiots with no soul.

[Jammie]

Morally and ethically, you are wrong. You agreed to pay a certain amount for that house when you bought it. If it would've appreciated, you wouldn't share the profits with the bank, would you? So now why should the bank take the loss instead of you?

Ok, that being said~send the keys back. Life is rough and your family doesn't need the extra payment when in fact, you'll be losing ground because it could take years for the price of your house to get back to what you paid for it. (And that's assuming that it will) It's obvious that you are already aware of that.

You seem to be an honest person and are struggling with this. You just ended up in a bad situation that was brought on by others. I'm going to venture a guess that you will find someone who will rent to you. There will soon be thousands homeless if owners refuse to rent to anyone who has let their house go into foreclosure. The trend will somehow have to change and renting will become more lenient. You may end up having to pay more upfront in order to get a rental, but there won't be room on the streets if the rules for renting aren't adjusted. You're one of the families I truly feel bad for. You're in the category of the hardworking people who just wanted a home and weren't trying to live above your means, etc. I hope everything works out for you.

[MrTudo]

This place is lost.

[Lilybeans]

I'm confused. You want to move to NC because that is where the office will be located. You also said your office is now located in Chicago. Yet, you bought a house in Florida.

Why not just keep it? Rent a place in NC for a year or two. The market will come back and you will have a nice vacation home.

[Rhett_Butler]

I had something similar happen to me on a car loan where I knew I was going to be late due to a budget miscalculation over one summer. Called the lender in advance and they didnt' care to work out any deal with me. Only AFTER I missed payments (like I said I was going to) did they call me with this pissy attitude about working something out with rolling payments to the back of the loan, etc...

Well, gee.... Thanks..... Now that my credit has taken a beating you decide to ride in and assess the situation and provide help. What a swell company!!!

Anyway, I feel the same anger welling up inside me toward mortgage lenders right now. What pisses me off the most is that this STUPID lender that won't work with you now when you are willing to compromise and still make payments (albeit at a lesser assessed value) will end up eating your loan, eating the house (and lord knows how many other houses along the way) and then it will be the taxpayer bailing their worthless arses out when they could have avoided all of it to some extent by offering a LITTLE customer service in this time of near crisis.

Yes, I would walk away and mail in the keys. You can explain to them in clear english when they call whining that you were more than willing to work with them and they chose not to and so you did what you had to do...

I'm all for upholding one's contracted responsibilities, but I'm very against moronic corporate policies that are backed by taxpayer bailouts.

[gypsychic]

Well, I'm not totally without sympathy for your situation; however, you don't really HAVE to move, you just want to for business reasons. It's not like you had medical emergencies or an accident. I have to agree with those here who feel you need to deal with it responsibly.

I do wish you best of luck.