An upside down mortgage, where you owe more on the home than it is worth, can weigh heavy on the homeowners shoulders and the situation may seem impossible to escape. Don’t worry, there are five things you can do to help you out of this sticky situation.
First, modify your mortgage. Work with your lender and see if you can lower your principal or interest rate. Secondly, consider a short sale. If your lender allows it, you can sell your home for less than what you owe, helping you avoid a foreclosure. This may also satisfy your lender so you won’t be required to make up the difference in price.
In addition, it is important to keep paying your mortgage payments. Even with an upside down mortgage you will still come to the point when you own the home outright. Keep making the monthly payments and try to sneak in an extra one or two here and there and in time your mortgage issue will be a thing of the past.
Furthermore, you can also rent the house out if you are able to charge a monthly rent high enough to cover the monthly mortgage bill, as well as any maintenance and repairs. This will allow you to find a cheaper place to live and save some money. Lastly, there is strategic default. Don’t wait for the bank to foreclose on the house – walk away. You may suffer credit damage, but you won’t have to worry about the loan anymore.
These five tips are reasonable solutions to an upside down mortgage issue.
Stephen K. Hachey, a Florida real estate attorney, can help your wade through this process and determine a positive solution. Contact him at 866-200-4646.
The opinions in this post are solely those of the author. The author takes full responsibility for the content. Like all blog posts, this is offered for general information purposes and does not constitute legal advice.