Two years ago I made the mistake of purchasing this house for way more than it's worth! I've been finding this out by doing research on it and how much homes are valued for around me. Yes I should've done my research before now but hey I was sooo exicted to have my first home! Unfortunately I didn't know about 'subprime" and "piggyback" mortgages until now and to be honest I still don't quite know all the ins and outs of them. When I purchased the house my credit score was 620, it's now 549 because of a couple payments not being on time, but everything is smooth sailing again. However my question is since my score has went down and I know I have to get it back up again,will I be doomed to stay stuck in this house forever??? I have been looking around and I've found some homes for $30,000 less than I purchased this one for!! I paid &59,000. The average value in my neighborhood is $35,000! Also would it be possible just to sel it back to the realtor itself, since they are the people I pay the second mortgage too? Oh one last thing, when I purchased the house I was told after the two year period my payment could possibly go up, so I'm scared about that too! HELP!!
Hate to be the bearer of bad news but you may be stuck for the time being. A couple of years ago, when you purchased your house, home prices were still rising. Now home prices are dropping, that is why you now owe more then the house is worth. The only way to to get out of your home, besides forclosure, is to sell the house. Keep in mind it will be unlikely that you could sell your home for what you now owe. As far as the monthly payment, it sounds like you have an adjustable rate mortgage instead of a fixed rate mortgage. Your payments will continue to rise as interest rates rise. To get out of that you can refinance to a fixed mortgage. However, since you now owe more than your house is worth, you will be hard pressed to find a bank to loan you the full amount that you now owe. Don't despair, you are not the only person in this boat. I've heard some people have been successful in securing a lower interest rate with NACA https://www.naca.com/index_main.jsp
Message Edited by cgmiller63 on 09-11-200701:36 PM
I live in a condo and the owner is trying to sell it to me....for more than what it is worth...and on top of that I'm trying to raise my score...but I did find out that the housing market has drop alot...good luck
My sister had the same thing happen to her during the housing bust of the 90's. She had a condo that she was upside down on. She could not even rent it out for the monthly payment. She ended up walking away from it and letting it go into foreclosure. It took her a while to get her credit back up, but she now owns a nice house.
Message Edited by cgmiller63 on 09-11-200702:02 PM
The good thing is that this is a relatively small mortgage, so even if it goes up you might be able to stay where you are. Eventually the market will rebound. 2nd option sell the house for what you paid to an investor and reimburse their negative cash flow. 3)Be careful about short sales and deeds in lieu. They may not end your liability and the lender may also file a 1099 for any amount they forgive-which means you owe tax on it.4)Avoid foreclosure like the plague. It's better to work out almost anything else.
Before I contact naca; do you personally know anything about the company (naca) you provided the link to refinance a home mortgage (such as anyone who has actually used them to re-fi)? Do you know 4-sure these people are truly on the up and up?
I did notice a 50.00 per month membership fee which states it goes on for 5-10 years if they help re-fi for you?