Legal Question in Credit and Debt Law in Florida

Re: Turning House Back to the Mortgage Lender

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Frankly, the family has no business in buying another house considering the problems with the first house. This is what got many families into problems in the first place. Instead, they should try to speak with the lender and see if the mortgage problem can be resolved by getting better terms which some lenders are now doing do to the crisis which exists with all the defaults.

Failing such, you better make sure that whatever house you purchase will be comfortable for a long time because when you turn the house in, your credit will be ruined unless the lender agrees to a voluntary foreclosure without any demand for a deficit. Further, any payments or interest which is forgiven will be considered a gain for income tax purposes and you will be taxed on that gain.

Scott R. Jay, Esq.

Re: Turning House Back to the Mortgage Lender

I'd have to know a lot more about your situation to give you decent advice. Letting the house go back is going to show up on your credit for ten years.

It is also unusual in WA. I can't speak to other states, I'm not licensed elsewhere.

Re-financing probably won't help if the house is over valued.

You might do well to do a consult with a local bankruptcy attorney.

Elizabeth Powell