Ms. Lank: I own a house in another state, and we rent it out. Last month, there was some water damage caused by water backing up through the toilets. The insurance company sent us pictures, and the damage was not very bad.
The damage caused by the renters, however, is very disappointing. The drains in both bathrooms and the kitchen leak. There is mold under the kitchen cabinet. Carpet has been removed from one bedroom.
We do not have the money to do a major cleaning. We can no longer afford to keep this house. If we let it go into foreclosure or give the deed to the bank, what are the ramifications? How do we go about it? Is this the wisest course to take?
Selling would be difficult, as there is a hoarder living next door. My husband and I are in the 70-80 age group. -- E. A.
Answer: Your note demonstrates once again the hazards of becoming an amateur landlord, and an absentee one to boot.
Perhaps that house was your former home. If so, when you decided to leave the state and keep it, your first step should have been to calculate whether the projected income would pay for ongoing maintenance and professional management.
Landlording is a skill.
I doubt you could give the deed to the bank. You need professional help.
Start by consulting several real estate brokerages out there. It won't cost anything to see whether they think they could sell the place for enough to cover the mortgage(s).
Anything will sell, if the price is right. If you just abandon the place and a foreclosure auction doesn't bring enough to pay off the debts, you could still end up being legally responsible for the shortfall -- and it won't do your credit rating any good.
Ex on the Deed
Dear Edith: My fiance was married before. He and his wife divorced in 2002. In the divorce decree, she was given the house. He was taken off the deed.
Fast-forward 15 years: We are a week away from closing on our new house and we get a call from the mortgage company saying that we can't go further because the mortgage he shared with his first wife is popping up on his credit report.
His ex-wife passed away in 2016. She didn't have a will or anything and never refinanced to get his name off the mortgage. Since her passing, the mortgage hasn't been paid and is on his credit report.
We worked with the mortgage people for about six weeks after trying to come up with a solution, and we didn't. It was a Federal Housing Association mortgage, and the Department of Housing and Urban Development did not approve going around the divorce decree.
I contacted the bank that holds the mortgage, and it denied my request to remove his name. I have contacted two attorneys, and neither one said they can help me.
I have to get this off his credit report so we can get approved for a mortgage. That's my story! I sure hope you can help me because I have never heard of anything so backward. -- K. O'B.
Answer: Your fiance has more to worry about than just his credit rating. He once promised to be personally responsible for that mortgage -- the whole amount, by the way -- and he still is. He was taken off the deed but not the mortgage. It's his debt. I assume his divorce lawyer pointed that out back then.
Someone must be administering his ex's estate. He should stay in touch with that person. Let's hope that house goes on the market soon. Even if it goes into foreclosure, after this many years, the remaining mortgage debt may be small enough that a sale would wipe it out.
More Hedge Vs. Fence
More mail is coming in for the elderly homeowner who wanted opinions on whether to replace a mature corner hedge with a white picket fence. Again, everyone who responded had the same advice.
Edith: Tell him it's no contest. He wants to keep the hedge. It softens a house and makes it welcoming. A white fence is clean, but landscaping makes a house. -- M. Z.
Ms. Lank: My preference would be to keep the hedge. Greenery just makes your yard look inviting. We can no longer do the maintenance in our yard, but we have it done for us, and it's worth it! -- J. E
Contact Edith Lank at www.askedith.com, at email@example.com or at 240 Hemingway Drive, Rochester NY 14620.
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