Stay put or pay off loan difference on underwater mortgage?

Good afternoon,you are faced with a situation that a lot of people are dealing with as well. To properly answer your question I would honestly need more information. Please feel free to call me at 410-878-2905Tony Sergi1st Mariner Mortgage

One option could be for you to pay down your current loan to the point were you can refinance into a lower payment and rent this home and purchase a new primary home. If you would like to discuss the details give me a call 602-531-7040.

There are pros and cons to consider. If your Loan is owned by Fannie/Freddie, you could refinance to a much lower rate under the HARP 2.0 program. This does not address your desire for a basement, nor will it reduce your principal balance. It will however reduce your mortgage expense. Another option is to try to do a short sale. This is where the bank agrees to accept less than they are owed for you to sell the home. Generally, one of the requirements for approval is being able to show that you don't have funds to make up the shortfall. Still another is to just walk away and mail the keys back. These last two options may have financial consequences as well as making it difficult to buy again anytime soon. Assuming you never were added to the title of the current home, then you would be eligible for a mortgage, but you would have to qualify on your own, since a short sale or foreclosure would bar your husband from qualifying for 2-7 years depending on the type of loan program you chose. Before you make any kind of decision, I strongly encourage you to discuss your situation with both a Real Estate Attorney, to discuss the legal aspect of your decision and a Licensed Mortgage Banker/Broker to discuss the hurdles to ownership you may face in the future. Clearly none of us have enough information to properly advise you in this kind of forum. Good luck to you ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com

HARP 2.0 would allow you to refinance this property and lower your monthly obligation.. Your loan has to be owned by Fannie/Freddie to qualify, but there is a product out there.. If you decided to "let it go" so to speak.. Then, even though you're not on the loan, you have been living there, and some lenders interpret this as a joint decision if you "let it go".. so that could hinder your next purchase... You probably have options, but there's a lot of info missing.. Best advice I can give you is to contact a local mortgage broker, and apply with them.. They have access to numerous lenders and are on top of all the current lending guidelines.. They should be able to find you the right loan product for your particular scenario... WilliamAcres.com

You would want to consult with someone who is familiar with the credit implications of a default on the existing mortgage--whether it is on account of surrendering the deed in lieu of paying the mortgage, attempting a short sale, etc. There may be a way to refinace as mentioned by others. There are also considerations about qualifying for the purchase of a new home in terms of whether you can qualify with only one income vs. qualifying with two incomes and two mortgages. I recommend getting a referral from someone you trust who is local & familiar with your neighborhood. Best of luck!