Help with Foreclosure Questions Please.. (California, credit, financial, properties)
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We have 4 houses...2 are being rented, one is on the market and one we are living in. Here is the problem..the 2 that are being rented are in california and we are literally going in the poorhouse. We are paying 700 out of pocket on one property and the other one is going negative am every month but we arent paying out of pocket on that one. This 700 bucks is killing us. We just don't have it anymore..really never did. I keep telling my husband we have to let go and we cant afford it anymore. 2 questions..
1. How does this effect our other properties?
2. Will they take the home we are living in? They can take the other property too we dont care we just dont want the house our family is in to be in jeopardy.
Any help will be appreciated. We are in serious financial trouble.
Thanks
Katzpurr
Your other properties won't be affected. Of course, your credit will be trashed, but you know that. And what banks were doing, until the end of last year, was sending out 1099s to you and the IRS for the difference between what was owed and what they ended up getting. This amount used to be taxable under IRS' forgiven debt rules. Last December, Congress and the Prez suspended this rule for a few years. That was the only direct financial hit that people in your situation took.
As long as you don't fall behind on your personal residence, the banks can't take it.
If you're behind on a bunch of other bills besides mortgages, you may want to check with a bankruptcy attorney to see what legal protections bankruptcy can offer you.