Profile picture for wessysmama

I desperatley want to sell my home and owe more than i can sell it for, what can i do?

  • February 24 2010 - Medford
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Answers (8)

Best Answer

Profile picture for SoCal Engr
Not sure that the "why are you desparate?" is needed to answer your question.

If you have to sell and are underwater, your options are...

  1. Sell for what you can, and bring cash to the table for the difference.
  2. Try for a short sale.
  3. If the short sale won't fly, walk away and let the property foreclose.

I'm assuming option #1 is not feasible, but it would be the cleanest. Sell for what you can get, and then add cash into the deal to make up the difference on what is owed.

For an attempt at a short sale, I recommend you find a RE agent who really knows how to get a short sale approved. Approval will need to come from the lender, as they need to agree to accept less than they are owed.

Option #3 is a last resort, but if you have to get out from under the house (i.e., options like loan mod, stay and tough it out, rent until prices come back, etc. won't work for you), and the lender won't agree to a short sale, then eventually that is your last alternative.

I believe the reason others are asking the "why?" question is that they want to explore other options for you (i.e., loan mods, rent, etc.).

Best of luck.
  • February 24 2010
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Wessymama, it sounds like you might be stuck. If you haven't suffered some hardship (i.e. job loss, health emergency, etc.), you will have a hard time doing a short sale. My gut sense is that a loan mod won't do you much good, but who cares, since you want to move anyway?

One other idea: I'm assuming the Medford market still kind of sucks, but are there any new developments or new construction around there? If so, you could try approaching the developer with an offer to "trade" your house for a new one.  In essence, they would have to take the amount you're short and figure out how to wrap it into your new mortgage.

It's a long shot, but you never know. Having been a developer, I can tell you that developers' lenders can get really creative when they have to.
  • February 25 2010
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Profile picture for SoCal Engr
From your response, I'd change "have to sell" to "need to move". Unless you are dead set on buying again, an option would be to rent out your current house, and then get a rental in a neighborhood (sort of a "try it out" approach).

There's no guarantee that prices will rebound anytime soon, but it would accomplish your immediate goal of moving away from the neighbors and into something with a bit more room, while giving you some space to plan for what you want to do long-term with your current house (and any future purchase).

Just an option...
  • February 24 2010
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Profile picture for Melina Tomson
The only way for you to move out of this house and get another house is to do option 1, that socal-engr mentioned or turn it into a rental property and rent it out, but then you would have to qualify for two mortgages since you don't have the required equity in the house to use rental income.

Just remember that if you do a short sale or foreclosure you won't be able to buy another house for a couple of years.
  • February 24 2010
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  • February 24 2010
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Profile picture for wessysmama
We have awful neighbors and our house is just too small. we recently had our second child, and are in a 2 bedroom house. we need more space!
  • February 24 2010
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Wessysmama:

As always, it depends on your exact situation.  Are you in financial trouble, or is it that you need to move?  I hate to link to an off-site source, but I wrote an article on this recently: http://www.pennerlaw.com/blog/?p=165

That may help you a bit.
  • February 24 2010
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Why are you desperate?  What is the situation?
  • February 24 2010
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