Asha Goel

Hi Asha:

I live in California but own a rental property in Maryland. I am thinking about putting the Maryland townhouse for short sale because I loose money on it each month and its hard to manage it remotely from California. I had purchased the maryland porperty when I used to live in maryland but then I relocated.
I have never missed a payment. I have good salary and its hard to prove financial hardship. I tried loan modification already. I do not have questions about short sale. If short sale goes through, that's my best case scenario and I am happy. What I want to be ready for is what happens if the short sales does not go through and Wells Fargo forces me to go foreclosure/deedin lieu or bankruptcy. I want to be ready for what happens if they do not approve my short sale. Also I have been told by Wells Fargo that unless I miss my mortgage payment they typically won't approve short sale. If I start missing my payments intentionally, it puts me on a path of no return. Also I am worried about not knowing what all bad things can come my way if I end up having to foreclose.
I had purchased my Maryland house for about 315K about 9 years back. It will currently sell for about 180K max. I still owe a first lien of about 240K on it and the second 10 percent lien of about 20K on it. First lien is with Well Fargo Home Mortgage. Second is with Wells Fargo Equity line of credit.

My specific questions:
1. If I start missing mortgage payments and then how long I miss the payment for an ideal scenario.
2. If I miss the payments, put the house on short sale and short sale gets rejected what are my options? Foreclosure? Deeed in lieu? Bankruptcy? What are the most desirable option for me in that case? What are disadvantages and advantages of each option considering that I live and own a nice property with lots of equity in California. The property that I trying to foreclose is in Maryland.
3. The fact that I live in California but selling a house in Maryland, which state laws apply for me when it comes to short selling?
4.The fact that I live in California but selling a house in Maryland, which state laws apply for me when it comes bank coming after my other property in the scenario of deficiency judgement or foreclosure or bankruptcy?
5. I have heard that in order to prevent the banks from coming after my house in California, I should create a living trust and put the california house in that. That will make it difficult for the banks to come after it. Is it as simple as that?
6. When they pursue deficiency say after a successful short sale, or during foreclosure, can they come after my assets. Which all assets? My monthly salary too?
6. My only assets really are the california house that I live in. I have about $160K equity in it. Plus my retirement accounts. I do not have much money in any savings/checking/liquid accounts. So my overall objective is to get rid of the Maryland house while protecting my california house as well as my retirement accounts.

-Sandeep Garg

Comments

Sandeep Garg November 14, 2011 at 4:25am

Hi Asha:

I live in California but own a rental property in Maryland. I am thinking about putting the Maryland townhouse for short sale because I loose money on it each month and its hard to manage it remotely from California. I had purchased the maryland porperty when I used to live in maryland but then I relocated.
I have never missed a payment. I have good salary and its hard to prove financial hardship. I tried loan modification already. I do not have questions about short sale. If short sale goes through, that's my best case scenario and I am happy. What I want to be ready for is what happens if the short sales does not go through and Wells Fargo forces me to go foreclosure/deedin lieu or bankruptcy. I want to be ready for what happens if they do not approve my short sale. Also I have been told by Wells Fargo that unless I miss my mortgage payment they typically won't approve short sale. If I start missing my payments intentionally, it puts me on a path of no return. Also I am worried about not knowing what all bad things can come my way if I end up having to foreclose.
I had purchased my Maryland house for about 315K about 9 years back. It will currently sell for about 180K max. I still owe a first lien of about 240K on it and the second 10 percent lien of about 20K on it. First lien is with Well Fargo Home Mortgage. Second is with Wells Fargo Equity line of credit.

My specific questions:
1. If I start missing mortgage payments and then how long I miss the payment for an ideal scenario.
2. If I miss the payments, put the house on short sale and short sale gets rejected what are my options? Foreclosure? Deeed in lieu? Bankruptcy? What are the most desirable option for me in that case? What are disadvantages and advantages of each option considering that I live and own a nice property with lots of equity in California. The property that I trying to foreclose is in Maryland.
3. The fact that I live in California but selling a house in Maryland, which state laws apply for me when it comes to short selling?
4.The fact that I live in California but selling a house in Maryland, which state laws apply for me when it comes bank coming after my other property in the scenario of deficiency judgement or foreclosure or bankruptcy?
5. I have heard that in order to prevent the banks from coming after my house in California, I should create a living trust and put the california house in that. That will make it difficult for the banks to come after it. Is it as simple as that?
6. When they pursue deficiency say after a successful short sale, or during foreclosure, can they come after my assets. Which all assets? My monthly salary too?
6. My only assets really are the california house that I live in. I have about $160K equity in it. Plus my retirement accounts. I do not have much money in any savings/checking/liquid accounts. So my overall objective is to get rid of the Maryland house while protecting my california house as well as my retirement accounts.

-Sandeep Garg

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