I am unable to continue paying my mortgage. I am in process of selling. Is forclosure & bankruptcy just as bad as a short sale.

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I am unable to continue paying my mortgage. I am in process of selling. Is forclosure & bankruptcy just as bad as a short sale.

My husband wants to walk away and let the home forclose b/c we are now upside down. We can barely pay the mortgage even though we have never been late w/ a payment. The agent suggest a short sale. What would be the down fall if we foreclosed and then filed bankruptcy or if we decided to try the short sale?

Asked on May 12, 2009 under Real Estate Law, Missouri

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

 

This is a complicated matter and far too involved to give a definitive answer here.  What I suggest is that you read the two articles I've provided links for.  They will familiarize you generally with the the ins and outs short sales versus foreclosures.  Then I would speak to an attorney about all of this.  This is a legal as well as financial matter and one that will affect you and her husband for some time to come.  Don't just consult with a real estate agent.

http://www.washingtonpost.com/wp-dyn/content/article/2008/06/14/AR2008061400058.html

http://homebuying.about.com/od/4closureshortsales/qt/060907SScredit.htm


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