Your own personal SHTF

I agree with Beeman completely. If it were me, the horses would go, as would anything that cost me anything monthly such as the satellite tv, XM radio,etc. I'd also sell the truck (if they are two years from being paid off you ought to be able to get that and a little more out them) and buy a gas friendly car or two if both of you will be working. Then, either renegotiate your mortgage or rent out your home. (However, with such a hefty jump in payments, you probably couldn't rent it out and break even. Why the big jump anyway?)
I don't think you'll be able to go to NM quickly and buy a new place before Feb. seeing as your mortgage will be on your credit report, and your debt to income ration probably wouldn't allow for another home purchase with mortgage, especially with financed trucks on there too. (Is this a reported mortgage or it it simply an unreported legal land-contract between friends?)
If it's not reported, would your credit even allow you to purchase something else through a lending institution? If so, I'd say you should try to get a conventional mortgage for the place, and pay off the friend, then put the place on the market and sell it or rent it out, and move with a clear conscience and clean credit.

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A friend of ours tried to sell her house in AZ for months- no takers. She left the house and moved to WI. She kept paying on the electric ONLY in AZ so that the realtors could show the house and show that the lights etc worked. After five months the house finally sold but for $70,000.00 less than what she paid for it a few years ago. The bank took the hit on it - it was called a "short sale" and I suppose her credit did also but she is now living where she wants to live and is renting.
I think you should try to rent it out but you would have to have someone be a caretaker in case of problems with the house. Do what you have to do to maintain your health.

talk to your mortgage company the bailout did provide for renegotiating of old mortgages. At the very least, let them set up a short sale for you. They will help you find a realtor, etc. and tell the realtor what amount they are willing to short sale for.

A short sale will look much better on your credit.

I hope NM weather is going to help you the way you hope it is.

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Depending on the size/style/etc. of your house, maybe you can sell it owner financed. Have it set up with the bank for payments to go into a savings account, then the bank takes the payment out of the savings account. We did that with 2 houses and it worked out well.

With all the houses that are being repo'd now, there are probably people out there who would love to buy a smaller more affordable home. This would eliminate you having to do the upkeep. And there's a slight possibility that you could end up collecting payments that are a bit higher than your payments so you'll have savings building in addition to having payments, taxes, ins. paid by the buyer.

Your health is important, do what you need for your health.

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I know that a short sale saves mortgage companies the trouble & expense of a foreclosure, but does it really cut in favor of the borrower that much? Either way the mortgage gets hosed for tens of thousands, which will be reported.

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I don't know if this would work for you or not, but here is what I would do if I was in your situation.

1. Drop everything non-essential -- cable, internet, whatever else you don't absolutely HAVE to have. Also sell the horses even if you have to give them away. Horses are a big money pit and cheap to replace when you get settled again.

2. Stop making payments on the house. SAVE every penny that you would have been spending on the house.

3. Sell one of the trucks or turn it back to the lender if you can't sell it, and save every penny of the payment on that, too. Or apply it to the other truck. I'd say sell both trucks, but you'll need one when you move, and if you have a horse trailer, you'll need that to haul stuff, too. Thin your stuff down to what you can haul in the truck and trailer, by the way. Keep any camping gear, tools, etc., that you have.

4. Take a look at New Mexico land on eBay (that may not be the best place to purchase, but you can get an idea of prices) and find an area where parcels are going cheap enough to pay cash for one.

5. Take your accumulated cash and go to NM, to one of the areas where parcels are cheap. Buy land, set up a tent, and go from there. If you build a really cheap little cabin, and have no mortgage or utility bills, you won't need much income, and it will give your hubby time to find a decent job. Or it will give you the ability to survive if a job isn't forthcoming. I'd do this stage of my plan in the spring, not right now when there's snow all over the place, but if you have any family or friends in NM that you could stay with, it might be a good idea for you to just GO and leave DH to deal with packing and moving your stuff.

If you follow my plan, you may not be living at the standard that you are accustomed to, LOL! But I think you'll reduce your stress levels considerably, and you'll be able to get to the climate that's better for your asthma. You can improve the standard of living gradually, as you can afford it, and keep from getting so deep into debt the second time around.

Wishing you all the best.

Kathleen

That's a fair plan.

I would add that if they find an inexpensive property in NM that they need to make sure it's at least 1/2 acre. There are a lot of 1/4 acre lots for sale in NM, but they are virtually worthless. The reason is that NM statute requires no less than 1/2 acre for a septic system installation. Therefore, 1/4 acre lots would only have value to someone who owns adjacent property.

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Would it help to find someone in NM and swap houses? maybe even go thru your morgage holder?

That's kind of a long-shot. How would you go about doing that? Maybe run ads in NM papers?

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I will probably take almost a year for them to foreclose on your house and evict you after you stop making payments.

whether the mortgage company can come after any other assets other than you house depends on whether the loan is recourse or non-recourse, and also whether your state uses "judicial" or non-judicial foreclosures. Even if your original loan was non-recourse, as I understand it, if you refinance the new loan is probably recourse. Lastly, although the loan may legally be recourse, that doesn't mean they will actually go after any of your other assets. A post that explains some of this complexity is here: http://www.calculatedriskblog.com/20...ubernerds.html

I'd strongly suggest you talk with a lawyer, as there's lots of little gotchas out there.

Re: moving to NM now or later, and your health, I don't have any specific advice, but I agree with others that maintaining your health is critical.

Best wishes...
--sgl

They won't come after him for a deficiency judgment.

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Charity has been trying to sell her horses, as a matter of fact I inquired about her walking mare but felt that I should probably not pay for another horse right now due to my own job situation. While I have plenty of land for a horse, barn, etc. the initial payment would eat up my cash reserves so I had to pass.

Lovely horse though for anyone wanting a very nice one. Unfortunately right now, even the really nice ones are becoming harder to sell due to the economy. You may have to either lease the horse out or try placing her with a 4H or pony club child.

Try renting the house out first if you can, to cover your payments. If you can't rent it, go to NM and find a place while you still have good credit. Then take care of the house. I would cut off the monthly stuff that isn't absolutely necessary, but do try to keep internet as you need to research jobs and a place to live. Get rid of that xm radio and drop to one cell phone, dump the landline if possible. Discontinue newspapers/magazines, and any other misc. monthly bills that aren't necessary.

Sell one truck for what's owed on it. True you will take a hit, but at least you won't be paying out that money every month. Keep the best running truck that can still pull the horsetrailer, downsize to whatever you can put in it and head to NM.

Health first, without it - the rest won't matter.

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Why won't you be sick in NM?

Hey.

In this economy, if they foreclose, banks will never give you a loan again. Lenders aren't taking chances anymore.

Try renting house out with an option to buy.

RF

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I have not taken the time to read all of the postings, as I am about to go out the door. I just want to make a couple of quick comments, as we have been in very similar trouble!!!!!!!!!!!!!!!!

First things first: you applied for work at your chosen location. If you can find a city in NM that is growing that is the BEST place to go! As the people move in, there is more deand for food and shelter to care for all of those people, which means more demand for workers, which means MORE demand for food, clothing, and shelter, which means MORE jobs!

That was how we ended up here in Kansas!

First DH got an interview, and I went along and put out my applications.

DH got the job, and I got an interview.

Then, I got the job also! And, we found a little place to stay!

Now, back to the OLD place!

Secondly: TOMORROW LIST THE HOUSE! It probably won't sell right now: it took us a year to sell ours. But, what have you got to lose?????? And, wouldn't it solve EVERYTHING if the house sold, even if it sold at a little of a loss?

If you cannot make the payments, call the bank. See if they can help you out. Say that you CANNOT, and that you are thinking of BK. They would HATE for you to declare BK, they might be able to help you out, at least with the soon-to-increase payment!

The above, by the way, is the ONLY part of this that we have not faced: we did not have an ARM. I hate ARMs. It is gambling. But, I am old enough to have heard about how sometimes the banks will cut you slack, when you are unemplyed. Maybe, anyways. And, you lose NOTHING by asking!!!!!!!!!!!! And, aren't mortgage rates on the way down???????

By the way, there IS life after job loss. BTDT. DH's workplace went under, and I was cut to one day a week. There was NO! way we could make it on one day a week income! So, we did the above, and Kansas has been very good to us! With work comes prosperity, and we might not live like it but we ARE prosperous! Money is often tight, but, we have land, 2 paid for cars, a home with a fixed rate, teenaged kids, and we are finishing a potting shed. Life is GOOD here!!!!!!!!!!

It took some years to pay off the credit cards. But, we did. Bankruptcy never QUITE became necessary: with work and an income all things are possible!!!!!!!!!!!!!

Terri

Do you still have good credit right now? Can you reneg the motgage at a lower rate before leaving if you will rent? Getting rid of it all sounds safest though.

Another option.

Since your husband still has a job, you go to NM now and he stays put until he can find a job there. Minimize your expenses (as others have recommended), put the house up for sale, and start negotiating with mortgage company.

I would also call your Congressman and ask for help. He/she might be able to bump you to the top of the list for getting government help. A phone call from the Congressman's office to the mortgage company could go a long way to solving this problem.

Take any job you can get in NM. Spend all your free time looking for a job for your husband and a better job for you.

Kind of a tough love approach, but has the possibility of getting you to NM for your health and avoiding bankruptcy.

Good luck.

Just a couple of thoughts from someone born and raised in NM, and who lived there about half of adulthood and who is now old, from a family of asthmatics.

NM is not the promised land you may be expecting. Going to NM and AZ for asthma is no longer recommended by most docs because while the air is nice and dry (good) the dust can be and usually is fractious (very bad.) Also many buildings (stores, etc) you will enter in the summer will be cooled with swamp coolers and may well give you a sudden attack.

You may still need to go there, but also need to expect to continue to suffer from asthma. One sandstorm can be deadly, so be prepared!

Now as to the finances: btdt on the pay cut. It hurts. But reality is nothing will work until one gets over the "can't cut this out because" or "it doesn't pay to let go of" mindset.

All we really need is a simple roof (probably rented apt.), food, clothing, basic transportation. So you may have to let the house go back, sell the trucks, cut out every frill, give away the horses, etc.

For us the key was when we went from "what do we need financially to live this way" to "how can we live on what we have."

Long term it was a very rich blessing. Just didn't seem like it at the time.

No matter what, it sounds like your credit score's going to be ruined. Big Deal... I can't ever remember my parents or grandparents ever even mentioning their 'credit score'.

If the weather where you're at is killing you, and you have no job, and can't afford your home, what's keeping you there? Sell it if you have equity, if not, take everything not nailed down, that belongs to you, and head out to NM.

Having lived in NM for almost a year, I can tell you yes, living is cheaper... but then again, so are the wages.

You can live for free... work as a volunteer in a NP or NF... campground hosts or whatever... usually rent is free and a stipend.

I wouldn't stay anyplace if it were a'killing me.

good luck to ya'll...

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I'm back!

About the asthjma: is it allergy related? If so, shots DO help! My sisters doc strung her along for 3 years on steroids. She finally broke down and got allergy shots, and after several weeks she is ALREADY better!!!!!!!!!!!!!!!!!