Legal Question in Real Estate Law in Arizona
We have perfect credit, are upside down on our mortgage. My husband is about to lose his base pay. What are the ramifications if we buy another house for less money and walk away from this house? We live in Arizona.
2 Answers from Attorneys
If you walk away from your home, there will be a foreclosure on your credit report, so you won't have perfect credit any more. Similarly, with a short sale, there will be a negative credit report. You have to be sure that you protect yourself against a deficiency claim by your current lender. The ramifications are the negative credit report that results from defaulting on the mortgage loan.
Hi, working with your lender to do a short sale rather than 'sticking it' to the bank is the preferred course of action for homeowners seeking to preserve as much of their credit as possible. it is often reported that short sales [selling the house for less than the loan balance] stings your credit for less negative points over 3 years rather than 7 years for a foreclosure. Plus, you can minimize your tax liaiblity. Call to discuss further.
Lance S. Davidson
Lance S. Davidson, P.C.
9590 East Ironwood Square, Suite 110
Scottsdale AZ 85258
www.CleverLegal.com
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