I bought a condo in Michigan in 2005. Its value has depreciated by 60-70% & I still owe about 80% loan. I moved out of Michigan in 2009 Jan and not lived in the condo since then.The condo association doesn't let me rent.So, since Jan 2009 untill now, I have been paying the mortgage [never defaulted] + association fee + utilities+prop tax, and not been living there or not renting. I had to take another job [military] recently and I'm not making 50% of what I was making before.Its becoming difficult to pay the Michigan condo related expenditure and living expenditure at the current location.
1. Is Short sale a good option for me?
2. Should I be a mortgage defaulter to be eligible for short sale? or not being a
mortgage defaulter, would the lending bank consider the short sale?
I think that its only a matter of time before you are in default on your mortgage. Whether by choice or circumstrances, you are not going to stay current on this mortgage.
That being said, there are few options. Short sale is one, deed in lieu is another, and foreclosure is the final solution. Most lenders will take the same applicaiton from you for consideration of both short sale and deed in lieu. Your lender will tell you the requirements. Many require the home to be listed for sale for 90 days. Usually the mortgage is in default when the short sale and deed in lieu are requested.
They consider your ability to pay (income, debt-to-income ratio, savings), the value of the home, what they think they could get for it in foreclosure, loan-to-value ratio, and a whole host of other factors. It can't hurt to try to sell the property for whatever price you can get... the worst that can happen is you go through a bit of hassle and the bank won't agree to it.