Question : Would YOU foreclose in this situation?
We own a commercial building with a monthly bank mortgage. We have a high credit score. Two average incomes. No one will refinance–tried 6 banks. Current bank won’t lower interest rate enough to even begin to help us.

Facts:

1) We owe nearly $ 70,000 less than the building is worth according to the latest appraisal evaluation by our bank. But we have also put that same amount into the building the past two years when we could get no one to lease it, plus the taxes, plus insurance, plus repairs.

2) We now have a leasee, but his payment is less than we owe, plus we still have high taxes and insurance. i.e. we are still putting money into this building in the negative column.

3) We haven’t been able to sell it in spite of listing on a commercial website, using a Realtor, fliers around town, word of mouth. We even have it for sale at a price $ 15,000 less than appraised evaluation. No bites. Nothing.

4) We are in a financial squeeze–making it, but oh so barely. We feel drained. Sure, I could get another job, but why put more money into a building where it’s in the negative column and that column is increasing every single month?

i.e. putting more money 1) into a building that won’t sell, 2) on top of what we have already dished out, and 3) which will only increase the negative column…seems futile.

And what if our leasee calls quits? What if either of us get sick with big medical bills? We’d have to go bankrupt anyway if those occurred.

SHOULD WE GO INTO FORECLOSURE? SHOULD WE PUSH FOR A DEED IN LIEU? Either seems a better option than keeping it, and a better option than bankruptcy. Our house is fairly protected as is our car. Yes, I know about the credit score dump, but feel our current situation is pretty bad.
Yes, there is $ 70,000 in equity, except that we have spent that same amount to support an empty building for two years. So we now have no profit whatsoever. And there is NO commercial realtor in this area, nor are things selling well anyway. It’s been on a commercial website for many months with not one serious inquiry. I have run out of ideas. Have asked for money from friends, gone to 6 banks to refinance, etc etc.,
The answered Landlord has apparently misread my question. I don’t OWE the equity, I owe the amount left on the loan.
current commercial mortgage rates

Best answer:

Answer by Smiling
If you have $ 70000 in equity, where were you only selling it for $ 15000 below the appraisal?

Also was the realtor a commercial realtor familar with your area? If not, you need to find one. If they are, what is their take on the building not selling.