Husband medically retired I have very small income our total incone is approximately $40,000 after taxes. We have a primary mtg. Of $1800 a month,a second house of $1100 monthly where my mother in law rents for$ 740 a month. Both taxes & insurance are included. W can pay our monthly bills if we are careful but cannot pay this mtg . His mother is 95, and the house is worth what we owe. The bank said since we can’t make the payments (we were using our retirement fund) I feel we need to cut loose this house & cut our losses before we can’t pay our, other biils. If you agree, how do we go from here? THank you. C P p.s. HIs mother would be well taken care of.
What do you suggest?
Your approach sounds entirely reasonable to me. Currently you are drawing down your retirement savings to keep up with the house payment.
At the very least I think you should meet with a local bankruptcy attorney and discuss a strategy of handing the house back to the bank and getting out from under any lingering liability for that house.
This might be a reasonable strategy for you but it will depend on the equity you have in your current house and your other bills.
Considering the meeting with the local bankruptcy attorney as an investigation of your options and not going to file bankruptcy. After the meeting, come back and post an update if you think that is or is not an appropriate solution for you.
Please post your responses and follow-up messages to me on this in the comments section below.