I own a condo. Not a huge condo, just a regular condo in what would probably be considered the suburbs. I bought the condo as a risk, right before the US economy crashed, knowing that as long as the economy didn't crash, I could refinance in a few years or sell the place and make some money. No harm, no foul.
Well, the economy crashed, now I'm significantly in the hole. The good news is interest rates are extremely low. The bad news is I have a first and a second loan, and no one will touch me for a refinance. Despite a good job, good income, and a decent credit rating, I can't find a lender. I have spent the last two months on the phone looking. I even got Bank of America, the current holder of my loan, to hang up on me.
I can still make the payments, but I'm not saving anything, and eight years from now when the variable rate kicks in, there will be no way for me to pay my mortgage, I'll have to walk away, and my credit will be screwed for the next seven years. Gee, yippy, skippy. So, 15 years from now I might be ok. There is another, not appealing but better option, walk away now.
Look at it this way. Between what I pay for my mortgage and what I would pay in rent is about 2000 (that's after fixing my taxes so I don't owe anything). Take that $2000/month, bank 1500 of it (keep 500 for "luxuries" like taking people out or going away for the weekend), and after 7 years, when my credit rating comes back to life, I have $105,000 in the bank, and decent credit. The alternative in seven years? Stay here, have 0$ and a poor credit rating.
The problem? I have to walk away from my obligation to pay the loan. I am not happy with this choice, but considering I've tried for a little over two months now to get anyone to TALK to me about it, it seems like the only reasonable option. So, I hired a lawyer, and I no longer have to deal with the bank at all, but I have to stop making payments ... which will happen as of August 1.
So ... as of August 1, I will be in harm's way. But honestly, worst case scenario is I lose my condo and have bad credit with the potential for a new home in seven years. I've simply sped up time without time moving any faster. Normally I would feel badly about this, I do not, in the slightest, feel guilty at all.
I'll keep everyone posted when the bank starts to get angry that I've taken their dick out of my ass.
Comments...
Click the button to