What if your home value has dropped 45% and you now owe 190% of the value? What are our options?

  • April 06 2009 - Vallejo
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Answers (2)

your options depend on what your goal is.
  • September 07 2009
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Profile picture for caspianhiro
Can you afford your current payments?

Look into the Obama Mortgage Welfare programs. Several of them are made for people like you.

Call your bank and look into refinancing.

Is there a reason you need to sell now? A 45% drop seems like a lot, but you may be able to use a new estimate to renegotiate your mortgage.

If you can't afford it, you have no equity in it, and it really has fallen that much, then contact your mortgage company and tell them you are ready to walk away from it.

It will ruin your credit for 5-7 years. You'll pay higher interest rates on credit cards, more for home and car insurance, and most likely have to rent a place to live.

If you can ride this out, and can pay for the house, use this time to renegotiate if you can, and housing values will likely begin increasing again soon.

Think about it this way: NORMAL housing values increase about 3-5% per year. In about nine years (likely less) your house will again be worth what you are paying for it. In that time, you will have protected your credit, met your obligations and have real equity in the property.


  • April 06 2009
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