Questions about short sale

We bought our home in 2004 - its a 2BR house and it is just too small for us now. Our plan was to sell and buy a bigger house and have baby #3. Well, the baby part worked out, but we found out our house probably would not sell for at least $30k LESS than what we still owe.

In 2009, we inherited 1/3 of my mom's house, which is MUCH bigger and would suit our needs much better at this point.

If we sell our house thru a short sale, would that effect my ownership in the other home? And would the fact that we own part of another home effect the ability to do a short sale?

Also, we would love to not only live in my moms house, but buy out my brother and sister. I'm assuming that since we would short sale our home, would it be impossible to get a mortgage on the other shares of my moms house. My f-i-l told us he would be willing to co-sign - I dont know if that would help or not make a difference.

If anyone can give any advice, I'd greatly appreciate it. We are seriously busting at the seams here. I dont want to take advantage or abuse the system, and if it doesnt work out, we will take our share of our moms house (when it sells) and expand on our home. But I REALLY dont want to lose my childhood home

ETA: We cannot afford to pay the difference to the bank if we sold our house for less, because I'm assuming that has to be paid in one lump sum? Or could we use the same company to do the new mortgage and pay of the difference that way - with our new mortgage payment?

Message edited 1/19/2011 4:16:28 PM.

Re: Questions about short sale

this is a pretty complicated situation

I would need more info to answer the questions accurately- but I can answer them- I would just rather give you the right answers

FM me if you like and we can chat about how to handle this

Re: Questions about short sale

In order to get a bank to approve a short sale, you have to prove to them you are unable to make the mortgage payments. You have to write letters, provide documentations, etc. They won't agree to it without a solidly backed plea, for lack of better words. We looked into it a few months ago when we found out we would lose somewhere around $80k on our house. Also, a short sale will be a huge hit on your credit, and you won't be able to get another mortgage.
Maybe the best thing for you to do right now would be to rent out your current house and move into your mom's old house.

Re: Questions about short sale

I don't know anything about the short sale situation-- but what if you worked out a solution with your siblings that you could move into the house, and when the house you own sells, you will buy them out? Assuming they don't need the funds from the sale of the house for anything.

I would get in touch with an estate lawyer who could help to put together a contract, assuming all parties are willing to go into something that they may not reap a financial benefit in the near future.

You could also rent out your current home and use that money to pay "rent" to your siblings or something.