Legal Question in Real Estate Law in California

Re: Real estate

Before you look at potential legal remedies, you might want to talk to a real estate agent about the potential of selling the home in what is referred to as a "short-sale". A short-sale involves selling the home for less than the total of the liens on the home, with the lender taking less than what they are owed. This, however, is not the "miracle" a lot of people claim it is. First, they can take a very long time to process, depending upon your Realtor and bank. Second, it still means having to find a buyer, and in this market, though there are bargain hunters out there, its still a very difficult market. Third, banks aren't in the business of simply walking away from money, so they often will require that the Seller execute a promissory note to the bank for the difference between what they are owed, and what they agree to take at sale, payable over time in monthly installments.

Your other alternative is to walk away from the house - it will badly damage your credit, and you could have income tax implications as well as potential for personal liability for a deficiency (the difference between what the bank recovers from the property and what they are owed - though rare) and liability for a "sold-out second mortgage" if you have a second. I'd suggest that you talk to a local attorney if this is the only viable option for you.

*Due to the limitations of the LawGuru Forums, The Gibbs Law Firm, APC's (the "Firm") participation in responding to questions posted herein does not constitute legal advice, nor legal representation of the person or entity posting a question. No Attorney/Client relationship is or shall be construed to be created hereby. The information provided is general and requires that the poster obtain specific legal advice from an attorney. The poster shall not rely upon the information provided herein as legal advice nor as the basis for making any decisions of legal consequence.

Re: Real estate

If you are in rural Lake County and driving regularly to Napa or Sonoma Counties, consider the rental market where you are, what you could get, then what you could rent for the same amount near work or the hospital. Add in the savings in cash commute costs (gas, etc.) and see if there is an acceptable solution. Saving the rough miles on 29 could possibly put another $400+ per month in your pocket, particularly if you can get rid of a car completely, e.g. cut back from two cars to one. Also, think of the extra time you'd have without the commute.

Another possibility is a reverse mortgage, but I think you'd need substantial positive equity and be somewhat older to qualify.

Re: Real estate

Rent your house and rent closer to work?