AZ Investment Property Foreclosure

[Lonewolfemm]

What is the name of your state? Arizona

I invested into two properties to build and sell for profit. Unfortunately the market took a turn for the worst before the build was over. I am trying to hang onto them however it is getting beyond the means even with renting them out as there is a huge loss on them
I would be willing to try to make it work with one of them but I cant afford both.
If i let one go into foreclosure can the lender go after assests like 401K , would i need to sell personal belongings or 401K etc....before going into foreclosure or the lender go after those assests? I know the credit will be effected however at this point there is no choice. I know that with a short sale I will get a 1099 for the difference as income. does the same thing happen with a foreclosure?
the loan is at 240K and its worth maybe 160K and whatever fees on top of that

also i have other investment properties along with a personal property and how would those be effected? would i have to sell or refi, but there is no equity in them either.

[FlyingRon]

The lender can persue a deficiency judgment. Once the judgment is in hand they have options (based on your state law) to go after your assets. Other investments are fair game usually, retirement accounts are often protected. You need serious financial advice from either a CPA or lawyer specializing in this area.

[HuAi]

How are the properties held?

[Lonewolfemm]

The properties are held as single individual. Not in a trust or LLC or anything. Single family residence as an investment property.

I have been checking into other issues as well. As it "appears" that the lender was working with individuals that may have been "inflating" the appraisal to create sales and "selling" that the houses were worth 30K more once built.
However, they were not even worth the price of building more or less the appraisal.
Appraised at 280K and in 3 months dropped to 160K? guess it could happen.