| Choosing to Foreclose
What is the name of your state (only U.S. law)? Florida
My situation:
Military family who must relocate out of state on 2 months notice.
VA guaranteed loan, 1st Mortgage = $251,500 original/$243,000 owed. Second Morgage(for attached porch) $16,500 owed. I believe I could sell the home quickly for between $215,000 and $230,000. Total sale price would need to be about $270,000 sale price to break even on all debts. Leaves an estimated deficit of between $40,000 and $55,000 after sale which we are not even close to having or being able to cover.
Renting the house out is not a viable alternative due to rent values in the area. We can cover the mortgage for about 3 months before we would start going negative. I had planned on trying to sell the home for those 3 months with an asking price near what I would need to cover all debts. Even though I know the price would be unrealistic I feel I should try. So after this long-winded narrative I get to my questions.
1. I know I am covered up to a certain extent (I think 25% of loan amount) on the 1st mortgage by way of the VA loan. If the 1st loan only requires 15% funding by the VA to satisfy the debt, will the remaining 10% of the VA coverage then be applied to satisfy the second mortgage?
2. If not, is there a strong possibility I would have to pay back the $16,500 to the 2nd mortgage for the porch after foreclosure?
3. I've read foreclosure can take a few months before you are actually evicted. With the knowledge that a foreclosure is imminent without sale, is there any flaw to this logical statement? "I should stop paying my mortgage now and use the few months it takes for actual eviction to try and sell the house. If I sell the house, I will satisfy the accelerated debt in full. If I don't sell the house, foreclosure results but I have at least saved my self the 3 months of mortgage payments I would have spent anyway."
Thanks for your help.  | 
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