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Need Advice (Please)

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hgjohnson
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Need Advice (Please)  Reply with quote  

Hello,

My wife and I are currently living in a townhouse that we've owned since late 2004. The house needs a new roof, needs mold remediation (from a leaky water heater that had been leaking without our knowledge), and a few other minor problems.

We thought about getting a home improvement loan, but like I mentioned, taking on additional debt is not in our best interest at this moment. Also, even if we wanted to get an equity loan for example, we cannot do so since we currently owe more than the house is worth. Just to clarify, we are having no problems paying off the mortgage (it is not in default) or our other bills, but adding on a loan to fix these problems would really put us in a financial bind.

Talking to people and searching on the Internet have produced the following options for us: A.) modify the loan through a shared appreciation program offered by our mortgage company, B.) do a short sale, or C.) do a deed-in-lieu foreclosure (which would transfer ownership of the property back to the lending bank).

I found out from people who know about law that short sales and deed-in-lieus are similar transactions and both would wind up adversely affecting our credit scores. I also found out that because I live in Florida (a recourse state), that they can still go after me even after the shortsale has been completed. As far as the shared appreciation program, someone told me that they don't think it would help me much since my mortage is underwater, but isn't that what it's for?

Anyhow, like I mentioned before, we've been making our mortgage payments on time, so we have no problems paying off the property, however, our insurance rates are due to go up considerably in less than two months (October), so we wanted to know if we had any other options other than what I have mentioned.

Thanks.
Post Thu Aug 30, 2012 5:13 pm
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oldguy
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The mold remediation has to have priority. It is a 'disclosure' item, the property can't be conveyed w/o a 'certificate' - ie, it can't be deeded to the bank, sold, or conveyed until that is cleared. And your insurance company may drop you if the mold isn't cleared to their satisaction.

I would avoid the shared appreciation program. Some day, usually when you least expect it, real estate values will shoot up - 5 yrs, 10 yrs, who knows - but some day when the house is worth twice what you paid for it, you'll want to capture that profit and pyramid it.

How about a personal loan at a credit union? Credit card loans? Car loans?

I once bought the same used Pickup 3 times - paid cash the first time, got a credit union loan and made a Down Payment on a rental house, two or 3 years later I repeated, put the truck in hock again and made a DP on a second rental house. Anyway, paid for late-model cars can be a good source of funds, a collaterialized loan is always cheaper than a signature loan, car loasn are about 4% or 5%.
Post Thu Aug 30, 2012 5:45 pm
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hgjohnson
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quote:
Originally posted by oldguy
The mold remediation has to have priority. It is a 'disclosure' item, the property can't be conveyed w/o a 'certificate' - ie, it can't be deeded to the bank, sold, or conveyed until that is cleared. And your insurance company may drop you if the mold isn't cleared to their satisaction.

I would avoid the shared appreciation program. Some day, usually when you least expect it, real estate values will shoot up - 5 yrs, 10 yrs, who knows - but some day when the house is worth twice what you paid for it, you'll want to capture that profit and pyramid it.

How about a personal loan at a credit union? Credit card loans? Car loans?

I once bought the same used Pickup 3 times - paid cash the first time, got a credit union loan and made a Down Payment on a rental house, two or 3 years later I repeated, put the truck in hock again and made a DP on a second rental house. Anyway, paid for late-model cars can be a good source of funds, a collaterialized loan is always cheaper than a signature loan, car loasn are about 4% or 5%.


Thanks, oldguy. If anyone else has any other information for me, I would really appreciate it.
Post Thu Aug 30, 2012 11:59 pm
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Monika555
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I guess, you have already received a good answer about the loan. As for the home improvement, it is possible to save money doing some things by yourself. My husband and I have just replaced our roof and we did almost everything without help. Of course, it took a long time to find all necessary information, but it was woth it. We were lucky to find out the main things about roof shingles here. I hope you it will be helpful for you! Good luck!
Post Sun Nov 26, 2017 6:02 pm
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