Profile picture for user9681140

Better to lease or sell?

If you are underwater on a condo, with no equity (so re-financing isn't an option), and are able to make payments (so not eligible for hardship help), is it better to try to rent the place out (even if rent would only cover half the mortgage), or try to do a short sale?
We are moving out of state at the end of the year and have no idea what our best option would be.
  • August 07 2012 - Sacramento
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Answers (2)

Profile picture for SellingRVA
That's a tough one.  I would say given your situation, you are better off renting for the time being until you are able to sell the house for a profit.  Unfortunatelty, these cases occur a lot and ultimately you'll figure out yourself what will work best - just weigh all the pros and cons and see what makes the most sense financially. 
  • August 08 2012
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Profile picture for sunnyview
If you are moving due to a job relocation, that may qualify as a hardship for short sale. I do not know when you bought, but I would not hold a condo that pays only 50% of the cost of renting it out if you can arrange for a short sale instead. I would write the bank a hardship letter and see if you can get them to agree to a SS.

Before you decide on short sale though, talk to a local attorney on a 30 minute consult and ask several agents how long it would take to sell your condo in a 120 day listing period. Carrying an underwater asset that is down 40-50% is often along road to walking away later so it is better to try to deal with it now if you can.
  • August 07 2012
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