Help! I made a bad investment in a place that is going nowhere. If I give my house back to the bank, will it affect my credit? :eek:

You bet it will do bad things to your credit. It will be the same as a foreclosure. The bank does not have to accept a Deed in Lieu of Foreclosure. If it is foreclosed the bank may (depending on the state you live in) be able to come after you for a deficiency balance.

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Originally Posted by rebeccaspeer1

Help! I made a bad investment in a place that is going nowhere. If I give my house back to the bank, will it affect my credit? :eek:

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Where did you buy? I'm in a similar situation and I'm trying to figure out what to do. I know there aren't many options so I'm trying to find the least damaging option. Email me.
Thanks!

I assume that the property may be worth less than is owed on it. Neither you or the lender want a foreclosure. Contact your lender to see if they might be agreeable to a "Short Sale". That is where you sell the property and the lender settles for less than what is owed on the mortgage. If the Short Sale does take place it will be better than a foreclosure, but the lender will send to you and the IRS a 1099 for the amount of the shortage that you will have to pay taxes on. I believe that the Feds are considering changing that rule. Good luck.

I'm in the same situation - own a home in NY - no problem with this home, I'm not selling, but I bought an investment condo in Myrtle Beach less than 2 yrs ago - I'm into the property at over $600,000. Several of the units in my building are selling from $369-$419k
I owe the bank $525,000. I'm ready to loose my $ and walk away - What's my best option?

Yeah, I would like to get some credit for not defaulting. Credit me for renting it for less than the payment. I moved but could not sell... not even for the pay off amount, which I know is pretty common place, but I am down 140,000 and still making payments. Two options: 1 give it back. 2 keep making payments from a second or third job and rent it and hope like hell I can sell it next year. But let's not forget about cap and trade, which the rich for life politicians in Washington don't have to worry about.
People don't you understand that once these people get into office we owe them and their families pension and health care for life. Public service my ***.
It's your *** that is being serviced.

Im at the tail end of a blood bath of a divorce. I ended up with a House I don't really want, consumer debt, and a hefty sum of child support each month. There is work that needs to be done to the house to make it sellable, but my financial resources won't permit that work any time soon. I am moving out of the house within 2 months regardless. Would it be in my best interest to forfeit the deed?