BiggerPockets

Hi Jane, sorry to hear of your troubles. Your best option is to sell your properties. Clean them up and price them to move quickly. Even with the falling market, your 20% down payment should allow you to move them without having to bringing much money to the table.

When you say " paying only the minimum payment" do you mean you had Option ARMs on them and you were paying the minimum so that the loan balance was going up? That may be a different story because you would have consumed your down payment with the negative amortization on the payments.

What is the situation of the price you could get on a quick sale vs. what you owe?

You won't be able to just " give them back" and have them forgive the debt. You may be able to get them to accept short sales, given your job and moving situation. That may be complicated because each lender will see the other properties as assets.

Jon

Hi Jane. Those " sell your house now" sites are investors like most of the people here. They're going to buy your house at a significant discount. They're typically going to pay 70% or less of its retail value, because that's the kind of discount that it takes to generate a profit in this business.

Here's the harsh reality: If you've had a house on the market for six months with no lookers, its priced too high. Simple as that. There is some prices that it will sell at and sell quickly. For that matter, I'll buy it from you sight unseen for $1000. So, I'm certain there is some price where it would sell this weekend. Whatever price you have it listed for is not 20% below market. Its above market or it would have sold. The market may well have fallen dramatically since you bought it or even since you first listed it.

Based on your numbers, I think you bought houses for around $150K, and put down 30K (20%). Your loan balance is now about $128K. If you could sell it for $150K, you would net about $138K, which would pay off the loan and give you some money. If you sold it for $140K, you would net just about the loan payoff amount. If you have it listed over $140K, I'd cut the price to $140 right now and get rid of it. Even if you have a contract tomorrow, it will take at least 4-6 weeks to close.

Even if my numbers are off, you can apply the same logic to the correct numbers.

If it will take a price lower that $140K to move it, you will either have to bring money to the table, or convince the lender to take a short sale. If that's the situation, getting in touch with one of the " we buy houses" people may be a good idea. If you find one who has done short sales and knows how to deal with the banks, they might be able to negotiate a deal. Your listing agent may be able to do this, too. But, many normal retail agents aren't very familiar with short sales.

If you do talk to investors, don't sign your house over. You may be asked to sign a purchase contract and a deed right up front. Thats not necessary, and can leave you with a mortgage even though you've given the house to someone else. If you sign a deed for the house to someone else, you no longer own it. A bad situation could get much worse.

You have some of the issues that make banks accept short sales. Job loss, a forced move, no income and no assets. It might work. Trouble is you have four houses. Banks are more included to do this for an owner occupant who's losing their house than for an investor who made bad investments.

I would call up your lenders and have a discussion about the situation and what they might be able to work out with you.

I don't know what credit issues it will create for you to default in the US and move back to the UK. We do have a member here from the UK, and I suspect he'll chime in when he gets a chance.

Jon

Jane,

The foreclosure process and other things are not the same between the FL and the UK repossession process. Even if you lost the properties you may have zero debt owed after the fact. You need to check into the FL process so you know exactly what the option looks like. I am not recommending you go in that direction. I am concerned that you may look at specific choices based on what you think could happen rather than what actually could happen.

Check with the lender as they might be able to work out something rather than have the loan go into default. Or they might need the loan to go into default before they can do certain things.

John Corey

PS. US investor based in the UK.

Hi All,

Just to update you....I have been to see 2 VA's & an accountant. The upshot being that Dave & I will be returning to the UK in the New Year.

Thanks for everybody's help & advice.

Happy Holidays

Best Regards

Janet PS ..............Anybody want to buy 4 houses???

There are options you have when in predicaments like this. Of course your options are limited, however, new legislation makes life a little easier. A " Deed in Lieu" of foreclosure is an option, provided that you have only one loan on the property. If you have 2 loans ( a 1st and 2nd Lien) then all bets are off for a " Deed in Lieu" .

You can do a " Short Sale" . Banks/Lenders are entertaining short sales all day long in lite of the current market conditions. However, you need to find a skilled foreclosure prevention/mitigation specialist who knows what they are doing. The " Short Sale" process can be a headache. But its a viable option. The only true barrier is finding a buyer to make an offer. Good Luck.