Even with a BK, she may not be able to just walk away.
The best way is to do a short sale.
What is the house worth? Is her debt 300k greater than its value? Or might the house be worth 250k leaving her only 50k in the hole. The only way anyone could advise you on this would be to consider her income, her house payments, any other payments on other debts, any other assets, etc. Maybe you and she should ask to visit a loan officer at a local bank to discuss her situation.
PS, it isn't really necessary to pay off a home mortgage. Lenders will issue 30 year mortgages to 75 year olds. You just make the payments and most of the time build equity in the home, and when you sell it, you pay off the loan and retain whatever equity you have built up.
Just sell it. Doesn't have to be to a relative or at a reduced price.
Everyone is in debt when they buy the house. Not unusual. Do you mean something else?
No one gets a discount on the sale. What are you thinking? This sounds more like it is her issues and not yours. You are not responsible for her debts unless you are married.
She has to sell it for over the 300k owed, which really isn't much for CA.
Why not just continue to live in it? Why does she have to do anything at all? She won't be able to buy another home if her credit is bad.
Are you saying that she is $300K underwater or just that her loan balance is $300K. The first and preferred option is to SELL the house.
My mom does not (and never will) make enough money to pay off her debt. Other than declaring bankruptcy and walking away form the house, what are her options? Would it be a good option to sell the house to a relative for a reduced price? Or refinance (she has bad credit)? Just trying to find the best option. Thanks.
p.s. The state that this is occurring in is California.
