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New Visitor
vs3214
Posts: 2
Registered: ‎10-09-2012
0

Advice in this tough time.

[ Edited ]

Here is my situation.  

 

Currently in some tough times after being laid off my second JOB about 6 months ago after surgery. We tried to delay some payments, but right now I'm just stuck with one JOB and it's not enough.  My hurband is also strugling to find a job due to his condition.

 

I had a repossesion of my car last 2 months ago.  

 

Our house is paid off, but had to take out a property tax loan about 6 years ago.   I defaulted on that loan, and right now they are saying I owe 25K.  They are threatning to forclose in the next month....

 

I honestly don't what my options are right now.  My equifax fico is 579.

  I have the repo on my account, a collectinos of $98 from SWB  and a perfect history on a secured CAP ONE card and perfect history on a second CAP ONE card with a CL of $750

And a newly opened credit builder loan for $300 at from a local credit union.

 

The only option right now I believe I have is trying to get a Home Equity loan, becuase our house is valued at around 220K.  But I don't know if I would be approved or not.

 

What would you suggest in this situation?

Moderator Emeritus
llecs
Posts: 32,880
Registered: ‎08-04-2007
0

Re: Advice in this tough time.

Welcome to the forums! Sorry it's for this.

 

What are the reported balances on your CapOne CCs? I'd pay one to $0 and get the other to a balance under 9% of the CL. If your balances are high now, then you stand to see an increase.

 

Send a PFD letter to the CA. Search these forums for examples. Basically it says you agree to pay $x if they'd agree ot delete it. That can be worth quite a few points.

 

I'd go to your local small bank or CUand ask them about options. Maybe they can come up with something.

 

Also talk to the tax agency. Maybe they can stall this based on economic conditions. A family member faced the same thing and we got the city to delay it by a year which was more than enough time to fix it.

New Visitor
vs3214
Posts: 2
Registered: ‎10-09-2012
0

Re: Advice in this tough time.

[ Edited ]

I have $0 balance on the secured card with a limit of $200, and the Card with $750 has a balance of $169

 

How long does a PFD usually take on average, and yes I'll search for this on the forums.

 

Thanks.

Moderator Emeritus
llecs
Posts: 32,880
Registered: ‎08-04-2007
0

Re: Advice in this tough time.

Your mileage will vary on the PFD. Some are open to accepting it. Some seemingly never do.

 

You might squeek out a few extra points by getting the $169 down below $70.

Frequent Contributor
TheConductor
Posts: 491
Registered: ‎07-24-2012
0

Re: Advice in this tough time.

Unfortunately, your situation is made worse by the fact that you transferred that property tax lien to a private lender. As a for-profit company, they're going to be less likely to cooperate with you than your tax assessor's office might have been.

 

As you're learning now, a property tax loan doesn't rescue you from foreclosure, it merely kicks the can down the road.

 

I'm guessing you've probably already asked the lender if they have any non-foreclosure solutions to offer and they've said no. But if not, try that first. Maybe they can accommodate you with a refinance, forbearance plan, or some other option. Refi seems unlikely given your score, but it can't hurt to ask! 

 

Do talk to your credit union and see if they can do anything to help. HELOC seems like a stretch with your current credit profile, but if anyone is going to give you a break it will be the credit union you already have an established history with.

 

Failing those approaches, I'd strongly advise finding an attorney who specializes in foreclosure matters to consult with on what possible ways you have of avoiding the foreclosure.   That's your most pressing objective right now, since losing $220k of equity over a $25k lien would be the worst possible outcome. Even if that attorney eventually costs you $10k, remember your return on investment is a potential 1800% - the remaining equity less your debts and expenses.

 

Consider the possibility that you may end up having to do a short sale of your house, and prepare yourself mentally for that strategy. Ultimately, it's better to sell your home and keep much of the proceeds than lose it all in a foreclosure.

 

My heart goes out to you in these tough times. Hang in there, and seek the best professional advice you can find!

 

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Established Contributor
jamie123
Posts: 766
Registered: ‎03-22-2012
0

Re: Advice in this tough time.


TheConductor wrote:

Unfortunately, your situation is made worse by the fact that you transferred that property tax lien to a private lender. As a for-profit company, they're going to be less likely to cooperate with you than your tax assessor's office might have been.

 

As you're learning now, a property tax loan doesn't rescue you from foreclosure, it merely kicks the can down the road.

 

I'm guessing you've probably already asked the lender if they have any non-foreclosure solutions to offer and they've said no. But if not, try that first. Maybe they can accommodate you with a refinance, forbearance plan, or some other option. Refi seems unlikely given your score, but it can't hurt to ask! 

 

Do talk to your credit union and see if they can do anything to help. HELOC seems like a stretch with your current credit profile, but if anyone is going to give you a break it will be the credit union you already have an established history with.

 

Failing those approaches, I'd strongly advise finding an attorney who specializes in foreclosure matters to consult with on what possible ways you have of avoiding the foreclosure.   That's your most pressing objective right now, since losing $220k of equity over a $25k lien would be the worst possible outcome. Even if that attorney eventually costs you $10k, remember your return on investment is a potential 1800% - the remaining equity less your debts and expenses.

 

Consider the possibility that you may end up having to do a short sale of your house, and prepare yourself mentally for that strategy. Ultimately, it's better to sell your home and keep much of the proceeds than lose it all in a foreclosure.

 

My heart goes out to you in these tough times. Hang in there, and seek the best professional advice you can find!

 


+1 Some really good advice here^^^^^^^^^.

 

You need to move on this! Don't sit on your hands now! You have money to work with using your home equity, don't lose it!

 

Go to your local credit union or local bank and start talking to them.

 

It sounds as if you are like a lot of people that are going through these tough times. Make sure you sit down and figure out a budget for your current income. Don't keep digging the hole deeper! It is really hard to come to terms with the fact that you might not ever be able to replace the incomes that you once had, but you need to do it.

 

If worse comes to worse call a realtor and get the house on the market pronto.

 

Good luck!

 



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