Q: My wife and I are separated and in the process of filing for divorce. She is also relocating out of state for work, and I remain in the condo (the deed is in my name). We purchased the condo at the height of the market, but now we owe about $60,000 more than its current value. Prior to our separation we had been trying to sell our condo as a short sale, but were unsuccessful in finding a buyer. Now, without her income, I will not be able to afford the mortgage. At this point I have never been late on a payment, but I have the foresight to know that this will not be the case for long, and I have just started the deed-in-lieu process.

Is there any benefit of me struggling to meet the mortgage payment as the deed-in-lieu goes through? I realize the negative impacts of a deed-in-lieu on my credit, but I am trying to soften that blow. Will making the mortgage payment as long as I possibly can have any type of positive impact on my future credit?

A: Good question, especially because in recent years many lenders have been telling those borrowers with financial problems, “Stop paying your mortgage for three months and then we will assist you.”

I completely disagree with that position. You should continue to make your payments, not only to preserve your credit rating but to show good faith to your lender. However, during the period that you can still make those payments, you should start reviewing alternatives.

You tried a short sale, but it did not work. Do you think you should try that route again? Talk with a professional real estate agent who has experience with short sales and see if there still is some hope.

In the meantime, you are also exploring the deed-in-lieu approach. If you are satisfied your lender will take back the house, then I would not bother pursuing the short-sale approach. However, unless and until you have a written statement from your lender that it will accept the deed in lieu of foreclosure, I would keep pursuing other options. But do your best to keep the mortgage current as long as you can.

Q: I added my daughter to the title of my condo when I moved out of state and she moved into the condo, living there for two years. She is now engaged and she and her fiance are buying a house together and do not want the condo. If she quitclaims the title back to me, will I have to pay a base up in the taxes or do they remain the same because I am the original owner and have never been taken off title?

A: I am not sure I understand the question. Your real estate tax is based on the assessment made by the tax department in your state (or county). The fact that your daughter was on title and then got off should, in my opinion, not affect the assessed value of your house and thus there should be no change in the real estate tax.

However, you and your daughter should consult a financial adviser, because there may be tax consequences when your daughter gives you back the property. Was it for consideration (did you pay her anything?) or was it a gift back to you? Your financial advisers should be able to sort this out.

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