Two weeks ago today, Jenn and I went and pre-signed the settlement documentation since we would be away, and then last Friday, the final settlement papers were signed and we were finally the owners of just one home again.
In short, for those that may not know - we did a short sale. After listing our house from March 1, 2011 - August 31, 2011 as a standard sale, on September 1, 2011 we switched to a short sale. The process there in super short terms is that the bank assumes the debt when the house is underwater. This is a middle of the road situation where we (the homeowners) avoid foreclosure and its bad after-effects, and the mortgage company also avoids foreclosure and its affects on the property value.
After going back and forth way to many times with the banks (mostly our primary lean holder) we were able to come to an agreement that had us paying about 1/5 of the primary deficiency in cash at settlement. The remainder of the deficiency to the first mortgage will then be listed on a 1099 as "income" to us, and we'll deal with those tax implications moving forward. With our second mortgage the first agreed to pay them a set value, and they waived (100%) the remainder of that deficiency.
Now that its all done, we can hopefully start working towards a better credit-situation, and stop thinking about what might happen with that other house. I want to say, to anyone who might stumble on this, if you have the option/ability to simply rent the property vs. short sale or foreclosure - do it. I wouldn't deal with this headache again, and in retrospect I think there were better options for us. Today, with it done and complete, I'm happy with the decision and the outcome, but knowing what I know now, 17 months after we listed the house, I'd definitely make different decisions a second time around.
This picture by the way is of the title company where we were signed away the house. Enjoy!
Also, here's a link to the post where I talked about putting it up for sale.
No comments:
Post a Comment