Posted by Kevin

I have been a little absent from this site for a few months trying to deal with some major setbacks.  I have a property in the downtown area of San Diego, a two bedroom – one bathroom place that I just can’t afford to keep any more.  I put it up for short sale in August and I have been plagued by phone calls and creditors ever since.  Don’t get me wrong, I am not complaining about the calls its their job and I wish I could make it easier on them but they have a process and it just takes a while.

This is my quick summary of what happens when you short sell, I did try a loan modification but they were not interested in taking it to a level that I could afford.

• I made a conscious choice to stop paying the bill.
• I use bill pay, so I notified the bank to stop any withdrawals from the lender.  I heard that you have to stop any and all debit attempts, some people just stop it for the exact amount of the payment and find out that the next month the bank withdrew a few cents less and the charge went through.  So make sure you stop all debt requests.
• Keep paying you HOA if you have one, they can be vicious and interfere with a short sale.
• Take the money that you should have been paying on your mortgage and transfer it to credit card debt, because at the 60 day late point your credit card companies will get updated and make significant changes to your account.   (Not quite sure how the new December laws will impact this but, pay off those revolving debts fast)
• I had three cards with almost $40,000 in availible credit and about $10,000 in outstanding payments due.  As soon as they found out about the mortgage late they cut the availible credit down to the amount of the balance and upped the interest rate.
• Also as soon as I make a payment especially on American Express they adjust the availible credit down to match the total I have on the card – basically making the card unusable because as soon as I pay they reduce the credit by that amount.
• The Bank of America card is down to $1000 and the Citibank card was closed.
• Get used to the phone calls, I used to get a call a day asking if I could make a payment.  Most people are really polite and want to help, they know that you are not the only person going through this.  Its just the phone used to ring all the time.
• I got the phone to stop ringing by having an attorney send them a letter disputing the debt and requested that I be placed on a do not call list.  This lasted about 2 months.
• During that time, I got a real estate agent who found a buyer and we started the short sale process.  He is on the phone with them ever other week.  We have an offer and most of the phone calls have stopped.
• It can take 6 months for the short sale to get approved, I have received the Notice of Default and Notice of Foreclosure.  The foreclosure is scheduled for February, the same month that I am supposed to hear if the short sale got approved.
• CREDIT SCORE is shot, last time I looked it was about 420, and I tried calling a credit repair place but then were unable to help.

So right now I am living without paying my mortgage payment and I have basically paid off the credit card expenses.   Let me tell you just how badly it sucks, especially because I have a business and I used my personal credit all the time….