Ducati Monster Forum

So I live on the border of Antioch and Brentwood.

I purchased the house for 270k in 2002 and have second mortgage which we used to fix up the house so I have a total outstanding mortgage of 390ish. At one time the house was worth about 430k but now its worth less than 200k =(

I believe both loan's are non-recourse. I am petty sure the first loan is since I never refinanced it.

The neighborhood is getting increasingly worse. Lot of Section 8 moving in over here. Just last night we had another student from the High School get gunned down Just a few blocks away from the house. This is the second homicide in that park this year. During the day its a very clean, calm suburb but I guess looks are deceiving. I would not even consider raising children here now.

Also at one time I worked closer to the house. I now work in San Jose and my job responsibilities are increasing. I am on the track for being a manager. Not to mention that being away from the house so much is putting a huge strain on my relationship with my fiancee and she is not happy living way out in the east bay by herself and does not feel safe by herself out here anymore in anycase.

I pride myself in being a responsible person but I am seriously thinking of walking away from this loan if its even possible. Financially it has been a difficult year and I barely have any money left each month which is my fault and since I don't even feel safe to live out here anymore and I am concerned about keeping my relationship or trying to make it work out.

I understand if I get some harsh comments. Even thinking about doing this is not something I am proud of.

I guess one option would be to try and rent the house

Would you be able to rent it out for any where close to what you pay a month for it?

This would be in hopes of the market getting better sometime sooner than later, and then selling.

I highly doubt it.

The house would need in increase 10% year over year for the next 7 years for me to break even again just in time for the next recession =). I don't want to live here for another 7 years and I could only imagine what the neighborhood would look like in 7 years.

I might be able to get enough a month to rent a small apartment closer to work like in the Fremont area.

That totally suck balls.

I don't have financial smarts, but I'd walk away.

"IF" it was a good neighborhood, it would be a totally different story... .02

Any chance of a short sale?

maybe get the loan "modified" by the lender(s)? I know some who have had principal reduced by huge amounts to align it with current value. Then sell the f*er and bail?

Really sorry to hear about this man, sucks.

Well if you want to stay there or on the fence about it, check out the government programs for loan re modification. If you just want out,  check on short sales then forclosures. The process will take 9 months to a year. So you have that much time not making payments on the house, you can save up a ton of money. I have a few friends that have gone through this, i believe it screws your credit for three years. 

My personal thoughts about people buying way more house than they can afford ... and having rented for the last few years, waiting out this BS ...

All of that aside, talk to an attorney.  Often times it makes sense to let the house slip into foreclosure and fight it, as you'll have a place to live for a year ( or more ) and the bank will just modify your loan.

Adam

PS: Be more modest with your purchases next time  ;)  Good luck  [thumbsup]

Sorry to hear ... it's a tough decision to make. 

Sorry to hear you're in this situation.  The major thing is that it sounds like you no longer want to live there, both for the neighborhood and your work commute.  At the price you bought at that time, doesn't sound like you went way over your head and it really is an unfortunate circumstance of the neighborhood going downhill and your work situation changing.

I've heard some other people say things similar to you, where bad credit lasts for 7 years, while in 7 years, the house won't ever be worth what they owe on it.  

Having been through the whole bad credit issue during my childhood (my parents had an investment property foreclosed on during our last big recession), it's not easy.  What I can tell you is that it sticks on your credit for 7 years, and it isn't much easier once those 7 years have passed.  You're starting at a less than zero type of place.  My parents are still trying to recover credit wise, and it has been 14 years.  

I've also heard of some of these credit issues haunt you on your professional life as well.  I've heard some of our Exective Managment question people who can't handle their personal finances, how can they trust them to handle the well being of the company as well.  I don't know how legal it is, but I'm sure it does cross their minds.

I think that both DQ and Hypurone both have some good ideas to try and work with your lender(s) and short sell the property or maybe like Darkstar says, rent it out and move.

That's my 2 cents.

you are an ideal candidate for loan and property modification, my friend.

the bank doesn't want another total loss on a loan - they'll likely work with you to have you be less under than you are.

I don't know about you but I don't feel right when I walk away from obligations. If it were me what I would do is the following:


1) Check out loan modification options. See what's out there. Work with the bank.

2) Cut expenses-stop eating out. No more sushi. You want fresh fish-get a fishing license and go catch it. Get rid of the cable, and possibly the internet. These are things you don't need. Learn to love pasta and chicken. Bring lunch to work. If work supplies free meals eat there every chance you get, and bring some home, too. Don't buy a thing you don't need. Anything you do need should be bought used, or on sale.

3) Get rid of the toys. Sell the boat, sell the car (get a beater), possibly even the moto. Ducati's are not cheap transport, especially with the mileage you do. You'd probably be able to sell it for enough to buy a cheaper little Japanese bike that would need less maintenance, less insurance (as it wouldn't be a liter bike) and you might even have cash left over. Have a yard sale-you no doubt have crap you don't use. Put up signs, sell stuff, collect money.

3) Rent an apartment closer to work. Walk, bicycle, or take the light rail-it goes right past your workplace. If you can be close enough for that, I'd get rid of all of the vehicles entirely. Rent out the house to help out.

4) Get a second job. Even at McDonald's. Make the fiancee do the same-if she wants out, she needs to contribute. You'll have more spare time once the cable and fun activities after work are cancelled anyway.

5) Pay down the house, or sell it to break even. You're going to be a manager? You'll probably get a raise-put the money into the house.

Find a way to make it work. My old man would chase me into the damn street with a hammer if I ever tried to walk away from my obligations. It's about your own personal honour.


You made your bed, you sleep in it.


And for make the beast with two backss sake, don't knock up the fiancee until you've straightened your shit out.  ;)



Lemme know if I can help.

Well said -- you can do it  [thumbsup]

Cheers,
Adam

I don't like walking away from my obligations ether and I never have but I think you missed the point Dave and Dr,

In 2002 this use to be a good neighborhood. Now I cant even think about raising a family here Its turing into a crap hole.

Since the economy has gone down hill they are moving what is called section 8 low income housing in here and the neighborhood is going to hell in a hand basket. it it was a good neighborhood I would not even be considering this.

This is not about sushi dinners, etc. I can afford the house. I guess its my fault also they decided to make my area into low income housing.

This is about feeling safe were you live and wanting to start a family and look out for them also.

My point is-rent it out. Move away if it's not safe, and get what you can out of it. But walking away? And do what? I can't imagine getting another mortgage with that sort of stain on your record. If I recall, there are government programs in place that give you various benefits for renting to section 8 people. At least, there were in mass.

Just look at what Ptam said-his parents have been trying to recover for 14 years, and *still* aren't there.

I don't see as you really have a whole lot of other options.

Thanks for all the advice.

I need to look into all the renting legal mumbo jumbo. I hear renting can be another pain in the arse.

So here are my options

1.) Live here and deal with it. Forget about starting a family. hopefully the relationship will make it etc.
2.) Rent it out and move closer to work. Being a landlord prob wont be fun.
3.) Short sale and Hope its a non recourse loan so most likely your credit wont be affected.
4.) Walk away and Hope its a non recourse loan and hope your credit wont be affected. Douche baggy thing to do...

Renting to Section 8. Not sure if I want to deal with that. I may not have a choice since you prob cant discriminate but I am in this situation because of section 8 Imo. But who am I to judge people =(

Section 8 is rather nice, as your money comes from the government, which is more dependable than the average tenant. I've been a landlord for years-it can suck, but it's typically worth it. Lemme know if you want advice.

Yeah for sure.... Thanks.

I will grab dinner with you one night and we can talk it over.

Make sure MrI pays. It was his idea you eat free anyhow.  [laugh]

Sushi it is then!!!

government will pay the majority, the renters will still have to come up with their part 100-500 or whatever they qualify for.

Yeah and it helps if you're an asshole. I can teach this skill.


If you can't actually be one, you can always go through a property management firm, who will take 15% of the rent, but also maintain the property and deal with the tenants. AKA you'll just receive a check every month. I have never done this myself though, so I can't vouch for it.


If you can manage to negotiate the mortgage down and knock a good chunk of the principal off, you can end up making a tidy profit every month. Put that towards the rent of your apartment or a down payment on a new place.


Save save save. The economy sucks.

As MrI says, from my personal experience the bad credit route isn't as easy as people make it out to be and it is a long road to recovery.

From my experience, doing the landlord thing isn't all that bad, you just have to make sure you take your time picking the tenants and you've got a little bit of cash reserve for repairs for things.  It is strange how things break all of a sudden.  I did look into the Section 8, and there are + / -.  My understanding is that the person has too many complaints about them, that they would be excluded from the program and like MrI says, it's a check coming from the government, so it can be more reliable than the average person.

I'd be as worried trying to start a family with the credit issue hanging over my head for the next several years as I would living in a questionable neighborhood.


He really can. [laugh]

Kids can shoot back...if you train 'em young enough ;D

Just a thought on the neighborhood... I live in the Bushrod Park area of Oakland (North side of Temescal) and about 6 or 7 years ago this neighborhood really turned around. It used to be really, really bad after dark and a number of neighbors and the local police really helped to close down some of the shadier homes and get some better folks to move in. Now it's a great little section of Oakland and I don't feel too worried (any more than I should in Oakland) riding my bike home late at night.

My girlfriend and I only rent, but we still like to get involved in the local community and see if there are things being voted on, such as section 8 housing, new buildings, etc. that we can maybe help influence one way or the other.

You can refinance!

http://www.usatoday.com/money/economy/housing/2009-07-01-govnt-foreclosures_N.htm (http://www.usatoday.com/money/economy/housing/2009-07-01-govnt-foreclosures_N.htm)

I am not a charity case enough to qualify for a Home Affordable modification and I don't Qualify for refinancing either.

I just read some more information about it. This loan program is a complete joke...

First you need to have a existing loan with Fanny may which I may have however...

Second I do not qualify since I am way under water. They are only refinancing loans that are with in 105% if the original loan.
Since I am 50% under water they wont touch me... Useful program huh? Also this is only good for your primary loan.

And yet another shooting

1 block away from me. School is under lockdown. Another Child was shot.

Here is a photo of my neighborhood. Looks are deceiving.

(http://farm4.static.flickr.com/3444/3925905373_fe0ef6a291_o.jpg)

I give up. I am out of here one way or another. I guess it just takes a few years for a area to go to shit when the economy goes bad.

Yeah not only was there kids shot in the drive by but when the guy fled the scene he hit and ran over a bunch of kids I'm hearing.

My co-workers wife works security at the schools here.

Lots of good advice so far and I've got nothing to add.
I hear your pain.
Sucks, but good luck getting through it.
Nice that you have a conscience and aren't committed to contributing to the real estate meltdown.
Stay safe and ride safe.  Plus best of luck on your relationship.  Hope it works out for you.

Ciao!

Police Just came by asking questions.

I wish I could have helped them but I was sleep during the time of the shooting =(