[quote=paramount]I bought early 2003, were those bubble years? I never even knew what a RE bubble was until around 2005~2006. The $1600 = PITI.
I bought for 270k and put 30k down (of my own hard earned dollars), I have been making payments (never even one day late) for almost 8 years now. I have nothing to show for it, nothing. It’s all gone. I never expected to ‘make’ money on my house, but I never expected it to be a liability either.
I told my wife this past weekend if there is some sort of August surprise and we are not offered any relief that we should positively walk.
It was my intention to move to San Diego this summer, closer to my office. This still may happen, it’s just difficult to do particularly with kids.[/quote](emphasis added)
paramount, I’m so sorry to hear about your predicament. It really does seem that life is unfair sometimes. This downturn has affected RE values as far back as 2000, esp. in hard-hit zip codes. I purchased in 2001 and even received a cash-back allowance at the time of sale, never refied or took “cash-out” and the only thing keeping me from being currently underwater is my 30% downpayment that I am hoping to recover in the next few years. Fortunately, my house is large and I am VERY well located and the sold comps around me are now picking up a little . . .
I don’t know what your current home value is but your situation seems so borderline like you could just get your lender to sell a “tiny bit short” enough to pay a *lower* RE commission and get out. It is MUCH easier to move kids in the summer, before school starts, if they are not in year-round school. The next best time would be winter break at the end of the year.
IMO, life’s too short to commute that long of a distance every day, esp. knowing that you will never recover your lost home value.
Selling short w/o wrecking your credit would probably be in your best interest but if you HAD to walk, depending on who your lender is, they may entertain a deed-in-lieu or cash-for-keys program with you. Fannie personnel are currently contracting with companies to handle these situations for them right now and compensating cooperating lenders. Why don’t you contact your lender, even though you’re current and see if they’ll explore your options with you. Tell them you and your spouse each commute 150 miles round trip a day and have kids or whatever else applies such as needing to live close to an ailing relative.
It may be possible after selling short or turning over the keys to obtain another mortgage in a couple of years or so, esp. if you can stay away from fannie and freddie and borrow from a direct (portfolio) lender. Run your credit score on ALL three repositories right now while it is good and save all the printouts. I know there are a lot of people in similar situations as you but this exercise will help you with your story later when you try to explain what happened and that you had NO WAY OUT but continue to drive for hours every day FOREVER. You struggled with the decision to let the property go but ultimately you had to move.
I’m being kind of dramatic here but just trying to figure out ways to later prove you are NOT the average joe-sixpack strategic walkaway that couldn’t manage his finances and so now wants a “break.”
IMHO, I don’t think trying to refi to a lower interest rate is worth it in your situation as it won’t do you much good except possibly add MORE to your principal. The sooner you can put this nightmare “investment” behind you, the better off you and your family will be.
