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Lucy, Esq.
Lucy, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 27198
Experience:  JA Mentor
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If I have a modification of 40K but the housing market

Customer Question

If I have a modification of 40K but the housing market dropped so the value of my home decreased, is there anyway to reduce the cost or am I liable to pay even if I am "upside down" selling my home? I bought it for 275K in 2009. With the modification I owe 273K. The house has been on the market for a year and just got an offer of 265K but still have to pay 6% to realtor as well so will have to come up with about 25 grand at the closing.
Submitted: 3 months ago.
Category: Real Estate Law
Expert:  Lucy, Esq. replied 3 months ago.


I'm Lucy, and I'd be happy to answer your questions today. I'm sorry to hear about your situation.

You are legally responsible for the full amount of the modified loan, even when the value of the house drops, because that's the agreement that you made. However, you could see if the bank will agree to a short sale, meaning that they agree to cancel the balance due on the loan in exchange for you selling the property for the market value. It's entirely up to the bank whether they're willing to do this, and you'd still have to pay any realtor fees out of your own pocket, but you might be able to avoid paying the difference between the sales price and the total due on the loan.

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Expert:  Lucy, Esq. replied 3 months ago.

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