PLEASE HELP ME WITH MY SITUATION

Get an attorney who will help them get it straightened out.

Akator,

There are a few things that your parents can do:
1.) Do nothing, continue as usual.
2.) Sell, and see if you can sell it for the balance owed.
3.) Rent it out, if your market has a demand for it.
4.) Refinance. This sounds like your most desired course of action.

They owe 462k vs purchase price of 463k. Are you assuming there's little to no equity? In your market, are the values of homes going up, down, or sideways? Have any improvements been done to the house in the last 5 years that would improve the value of the home? Has the home been recently appraised? Any of these potential events may have affected the value of your home and there's a chance that you may have equity and not know it.

Banks. Is the current loan with a national bank or a local bank (or other small financial institution)? You can try and shop for a new mortgage. We have an ARM on one of our properties and it has a balloon (or remaining balance paid all at once) that's due here in a few years. Changing an adjustable rate mortgage to a fixed rate mortgage would help with a budget and may cut down of the stress of the fluctuating payment.

These are just a few ideas I had while reading your post, and I'm sure others may have other ideas or want to refine some of mine.

Good Luck.

Regarding your parents situation...I believe the comments thus far have been right on.

There is an organization called NACA that has benefited a lot of people across the country with their home mortgages. I have heard great reports from friends that came away with very doable modifications to their loans. However the process is very time consuming mainly because so many people are turning to them for help. If your parents decide to get assistance from them, they need to plan on camping out for several days, just so they don't loose their place in the long lines. Just being real....!

If your parents can hold on and their income can sustain the monthly payments then it might be in their best interest to hang in there. Research your market by asking a realtor to pull comps & create a CMA for you to determine which way the market is going. Sometimes it is best to stop throwing good money after bad......what's the long term goals.

even if your parents short sale the house, they would still owe the remainder of the money unless they declared bankrupcy.

I would follow mikes advice.

With Michael's advice!! I will leave it at that. Nice response Michael M.

Thanks

Curtis Fillers
(Charlotte,NC)

We have a lawyer already he was the one who recommended the Obama Program he is trying to fill and hand in all the paper work. In the begging of the process i explain to my father about a short sale and he dint like the idea but ill explain to him again. with this economy the value of the property has gone down to around 395k according to the appraiser. i havent heard about the NACA program but i will investigate about it. throught the years we have done some improvement for example sanded the floors, fix the walls, made a new patio deck, planted new grass on the front and back, worked on the curv appeal of the house.
i really want to thank you all for the help and the good advise i will sit down with my dad and talk to him about at this new adeas.
Thank You B.C.
Thank you michaelmangham
Thank youGangremond
Thnak you michaelkc
Thank you Luiz
Thank you curtisfillers
Everyone thank you soo much.

i will keep you guys updated on the situation..
again thank you.
more advise will be more than welcome

I was going to suggest a SS also, but it sounded like they want to keep it and can possibly afford to from what i see. I didnt see where you said they were behind on payments.
Did you speak to the lender to see if you can work with them first? maybe get a fixed lower rate.
Other wise I would say a SS is the way to go, he would take a 2yr credit hit that way, but would be out of that mess. Or you can try to sell it for what he owes and walk away. The last one would be hard since it is under water.

Thinking outside the box - If he is desperate to get out he can try to sell it for less than he owes, say he owes 460k he can sell for 430k which would put 30k in equity in it if fmv is around 460k He would then take a personal loan for 30k and pay it into the house thus reducing the principal. It is a 30k debt but it is better than 465k that he is having a hard time keeping up with. just s little different idea i thought of.
good luck
Richie

Thats his best and only viable option

Good luck to you both

info that I have to help them, and it is posted on my website. I don't have to time to repost it all here, but there are DEFINITELY some alternatives there. Whether they want to keep the home and drastically reduce their payments or sell their home, there are MANY solutions I hope you can use. There are about 6 pages of info; I hope there is at least one solution in there to help your situation!

http://www.zionpropertiesandinvestments.com/AVOID-FORECLOSURE-HELP.html

http://www.zionpropertiesandinvestments.com/Options-to-KEEP-your-home-.h...

http://www.zionpropertiesandinvestments.com/Options-to-Liquidate---Move-...

If they want to short sale the property, it will only affect their credit for 2 years with an initial hit of 150-200 points off their credit. Foreclosure will affect their credit for 7 years and affect credit by about 250-350. Bankruptcy is 10 years and will destroy their credit by approximately 300-400 points. I have not updated this part of my website yet for lack of time and wanting to do a little more research on those numbers.

Have your dad check if his loan is a Freddie or Fannie (you can do this online at :

http://www.fanniemae.com/loanlookup/ and Freddie at
https://ww3.freddiemac.com/corporate/

or FHA.

All 3 have programs that will work on refis for up to 125% of the VALUE of the home right now. I've used 2 of the programs myself and am using the FHA on the property I took subject to right now. TREMENDOUS monthly savings by doing so! He can even work directly with the bank he is already with on these and avoid some if not all the closing costs.

Haven't had a chance to add those to my website yet either!

He does have more options than a short sale or loan modification, those are just the most commonly known.

so we are still trying to see what can we do.. but for now we are going to keep paying for the mortgage the way it is. until we try to fix a few things like our credit score so we could get a better loan for the house.. thank you everyone..

Luiz may not be right with the following statement:
even if your parents short sale the house, they would still owe the remainder of the money unless they declared bankrupcy.

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In most cases, Banks forgive the amount you are short and the IRS doesn't tax you on it if you have lost your job, moved away to take another job etc. You can even avoid forclosure by giving the deed in lieu of forclosure.
There is no need for bankrupcy in most cases.
However, checking with more than one attorney (some know more than others), will give you a better picture..
About refinancing:
These days banks look closely at your debt to income ratio in addition to the credit score.
Judith

i know i was a little scared with Luiz comment Thank you judithmuka.

Well my family's home was finally accepted for the Obamas Program. FINALLY!!!
our shifting $3000 to $5000 mortgage is now a fix $2100 mortgage including taxes. wow we almost lost the home. my parent were surrendering the house to the bank in a few weeks and the lawyer came to us at the right time.

I WOULD LIKE TO THANKS EVERYONE FOR THE SUPPORT AND THE KNOWLEDGE YOU HAVE GIVING ME.

Thank You B.C.
Thank you michaelmangham
Thank youGangremond
Thnak you michaelkc
Thank you Luiz
Thank you curtisfillers
Thank you Zion Properties
Thank you elixbrown
Thank you judithmuka
Everyone thank you soo much

If they wanted to avoid the credit hits, were feeling creative, and wouldn't mind being turned into Real Estate Investors, would a lease option work? Sure it's complicated but desperate times call for desperate measures. And if you're motivated enough, you can do anything
60k above current FMV is bad, but not that devastating. The price of a home worth 400k today will most likely surpass 460 when the economy "recovers". Would it be possible for them to hold the mortgage for someone who wants to lease to own?

The down payment could catch them up.

The sell price would be based on the estimated value of the property when it turns back into a sellers market digging them out of that hole.

The mortgage they're holding with an interest rate of around 6-8 percent which is the norm for Lease Options would not only pay their bills but put positive cash in their pocket. Wouldn't it?

But again this is just me thinking outside the box, I'm far from an expert.

Otherwise, I'd be blowing the Short Sale horn too.

Doh, I missed the last post. forget everything I said.

Congrats, I'm glad it worked out for you!

I LOVE HEARING Success stories like this! It is SO encouraging, because most of the time you hear how things DIDN'T work out and the successes aren't ever revealed. I am so happy for you!!!