topic Re: Help with Short Sale and Bank Note in Rebuilding Your Credit

Help with Short Sale and Bank Note

Anonymous — Wed, 06 May 2009 17:49:31 GMT

Thank you for your advice ahead of time. I really am not sure what to do. Here is my problem,

I lived in AZ and I lost my job several months ago. After losing my job my mortgage payments when from about 1400 to around 2000 with the ARM reset (My first mistake). Having no income and the increase payment, I decided to sell my condo which is worth about 50% what I paid for it. I research what would happened if I foreclosed and decided I will try to short sell first. After about 6 months on the market, I have an offer but there is a problem. The bank has been in negotiations over the sale for about 2 months and now has decided that I need to sign a Note for 5000 over the next 5 years at 0% interest. I did get a new job out of state about a month ago, and I am just now starting to get myself out of debt and now I might have to tack on another 5K in debt.

I currently have about 6K in CC debt and have a plan to pay it off quickly, but the 5K note was not part of it.

My finance and I want to buy a house in 2 years, and I know we just have to put it in her name because of my credit problems stemming from my condo (it was fine before I lost my job).

Anyway, do you think it will be worth in terms of my credit rating to sign the 5K note so that I will short sale instead of foreclose?

Thanks for your help.

Re: Help with Short Sale and Bank Note

MizzB — Wed, 06 May 2009 19:24:55 GMT

IMO, it seems like the short sale would be a better option than the foreclosure. Although you'll have to pay the 5,000, the matter would be settled. The house would be sold and the late payments would stopping being added to your credit report. If you take the other option, the lates will be added monthly until the foreclosure is finalized, plus you'll have a foreclosure on your credit file.

Re: Help with Short Sale and Bank Note

Anonymous — Wed, 06 May 2009 21:13:58 GMT

Thanks for your opinion, I think I am going to do the Bank Note even though my foreclosure date would be in 3 weeks anyway. Just so the report doesn't say "Foreclosure".

Thanks again.