bad investment

[Garry Stravinsky]

Hi,everybody.5 years ago I bought a condo for $115K as an investment(I rent it out).Now it costs on market about $70K and I still owe $75K to bank.I would like to get rid of this apartment.If I sell it now I'll get only $65-66K after agent'comission and still will be owed to bank $9-10K.What are my options?In case I fill for bankruptcy will bank go for a difference?Do they go after one's salary?What happens if I simply stop to pay mortgage?Thank you

[Petunia 100]

Hi,everybody.5 years ago I bought a condo for $115K as an investment(I rent it out).Now it costs on market about $70K and I still owe $75K to bank.I would like to get rid of this apartment.If I sell it now I'll get only $65-66K after agent'comission and still will be owed to bank $9-10K.What are my options?In case I fill for bankruptcy will bank go for a difference?Do they go after one's salary?What happens if I simply stop to pay mortgage?Thank you

It seems pretty drastic to file bankruptcy for such a small amount of money. (Assuming that you qualify). Have you approached the lender about a short sale?

If you simply stop paying and default, yes, the bank can come after you for any deficiency. Whether they actually will come after you is another story.

Why not just sit tight? Real estate prices are improving in many areas. You may not be underwater for long.

[snafu]

You're looking at taking a drastic step that will affect future choices in a negative way for the next seven plus years. Obviously the condo is only part of your financial picture. Keep in mind that employers now check credit scores and something as negative as a bankruptcy can ruin your chances of promotion or new career possibilities.

Is the condo rented? Does the rent cover your mortgage payment, taxes and HOA? Are you subsidizing your tenant? Do you have a good, reliable tenant? What is stopping you from continuing your original plan 2008?

I suggest you start by get all your financial information organized to deduce whether your circumstances qualify for bankruptcy. What are your other options?

[dunnrobert700]

Forget bankruptcy.

This is a classic case of panic selling low after buying high. People do it all the time with all kinds of investments - it's human nature. But it messes up your finances.

Unless you're facing some kind of acute cash flow emergency where you must get cash (and I'm not sure I see a way to do that here...maybe staunch outward cash flow), now might be the worst time to sell a condo in the next 20 years. Can't say for sure not knowing your particulars, but this is a great time to hold on.