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In summary

  1. The house became an investment when I moved 200 miles to take a much better job
  2. The house is $40K upside down in the mortgage
  3. I have stable renters, but they only pay 60% of the mortgage.
  4. I am not technically in hardship. I am only $100 or so in the red each month
  5. My loan is a single 40 year fixed, that is 2 years old
  6. I bought the house with an ex-wife and refi'd at the peak of the market into my name only as a favor to the ex. That added $400/month to my budget.
  7. My credit is currently very high 750-800 range.
  8. I am currently renting, have a 1 year old child and a very stable job

The issue and reason I want to ditch the house is I don't see how I can get my family ahead in life with losing $100/month. What if my car breaks down? What if I have some hospital bills? What if we get robbed or some other thing. There is no padding in the budget.

I have been told many times that as an investment house, I am not eligible for any of the bailout consumer assistance programs.

My ultimate feeling is that as an investment, this house sucks. I can't get out of it any other way than foreclosure since the market won't buy a house at the value I would need. I don't have any cash to make up the difference and take the loss. The only reason I think I should be paying is the "I-took-the-load-so-I-need-to-pay" rationale, which is becoming less and less ration the deeper into debt I go.

I understand my credit will be whacked for a few years. But I can save $800/month without this house and that will allow me to be debt free and actually save some money in short order.

Besides any moral issues, what feedback do you have? What am I not thinking of?

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1 Answer

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Well, to be honest, I think you answered your own question when you said:

I am not technically in hardship. I am only $100 or so in the red each month

Really, you need to sell this house. I know that you think you won't get all your money back -- but you'll have to either a.) get a short sale offer and take it to your bank to see if they'll accept it or b.) get a regular bank loan for the difference.

I'd be willing to say that option 'b' is going to be the best for you if you can swing it: yes, you'll be in debt a bit longer, but you'll be done with that higher mortgage payment and you won't take a hit on your credit.

Also, when you ask:

Besides any moral issues, what feedback do you have?

Are you stating that you don't want any feedback on the moral issues here?

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Thank you for the response. No, I don't want any moral issue responses, I have already spent a half year coming to the decision and have spoken to all the important people in my life regarding the choice – MrChrister Oct 11 at 14:57

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