We are 2 months behind on our mortgage payments and will not be able to catch up. Can we lose BOTH our homes?

Question

We own two homes, one has a mortgage of $1,200/month and we purchased it 9 months ago before the housing crisis so it is now worth less than we owe. The other is in my husband's name only from before our marriage and the mortgage is only $300/month (yes, three HUNDRED) and we owe only $15,000 on it total.

The bigger mortgage is in default (we are behind 2 months) and the smaller one is current. Both us us have been forced into job changes that have both of us still working full time but making significantly less than we were before. There is no way we can continue paying our mortgage on the bigger home, which is our primary residence. There is no sign our financial situation will improve anytime soon. We are fine with moving into the smaller one and letting the big one go.

So if we have a voluntary foreclosure or deed-in-lieu of foreclosure, can they go after our other home so we lose both and end up homeless since the value of the property is less than what we owe?

Answer 1

mabey try to take out a loan

Answer 2

~~As long as you did not use the smaller house as collateral against the bigger house then they can't touch the smaller one. The only recourse they have is to take back the bigger house. The only other thing which doesn't seem to apply to you is if you filed bankruptcy. With the new laws, they can force sales of everything you own to repay any debt you are trying to discharge. Other than those two things, your smaller house will stay safely in your hands. I feel for you both so much, so many hard times, and so much to worry about! Hope everything goes well for you!~~

Answer 3

Why dont you try renting one?  Can you sell a car to get the money to catch up on the mortgage of the bigger house?  There must be something you can do, even if you have to work more to keep from foreclosing and ruining your credit.  A temporary job, while looking for another job that pays more?  Making food at home to save money, dumping any extras, like cable, internet, etc.  Can't you get a cash advance on a credit card to catch up on the $2400 you owe?  Even if you worked, waiting tables for 2 months you could earn that, right?

Answer 4

You need to consult a fee only financial planner. Yahoo answers is good for getting ideas, and there may be some good ones in response to this question, but sometimes you need the advice of an expert.

You MUST consult an expert about this. As the saying goes, it's pay (the planner) now, or pay later (and you don't want to pay later!). Would you rather spend a few hundred dollars now and get professional advice, or wait and potentially become homeless?

Consult a fee only (therefore independent and will not need to sell you products to make money) financial planner, and best of luck to you!