Financing in Cherry Hill>Question Details

Maya, Both Buyer and Seller in Cherry Hill, NJ

I'm underwater on my home but am making payments and have good credit. I can't bring money to the table and need to sell to buy a new

Asked by Maya, Cherry Hill, NJ Fri May 6, 2011

home. Options?

Help the community by answering this question:


Well that may not be necessary.

We have a program that if it meet the requirement you can refinance your home.

It is called a SHORT REFI

> A minimum credit score of 560 is required
> You must be current on your mortgage
> You must occupy the residence as your primary
> Your existing loan may not be a FHA loan
> Your existing lien holder must write off at least 10% of the principal balance.
> Existing subordinated mortgages must be re-subordinated and the new loan may not have a
combined loan to value greater than 115%

If you would like to speak to me in confidence I may be reached at

Camille Marotta #9838
Branch Manager, First Alliance Home Loans
0 votes Thank Flag Link Fri Apr 20, 2012
You might want to consider converting your existing home into a rental property and buying a new home with an FHA loan.

FHA allows you to use the new rental income of your converted owner occupied home for qualifying purposes if you had a 30% down payment when you bought your existing home. You'd need to have a copy of the original HUD closing statement to prove this for the underwriters.

I closed one like this a few months ago where the buyers had put 35% down payment back in 2003 on their current owner occupied home which was now underwater by $10,000. They were able to use the new rental income to qualify for a 96.5% LTV FHA loan, all because they had at least 30% down payment back in 2003.
0 votes Thank Flag Link Fri Apr 20, 2012

Your only 2 options are to rent the current home out and get into your new home or you can try a short sale. A short sale will damage your good credit. Usually the current mortgage company will not even speak with you about a short sale until yo are deliquent on the mortgage and then the process can take several months to complete. You can always rent the home but make sure that you set the market rent for the property so you can get it rented quickly. Let me know if I can be of any assistance.
0 votes Thank Flag Link Wed Jul 6, 2011
Hi Maya:
Not knowing your current financial situation, I would suggest you rent out your present property and move on. Not only will you have someone else pay down your mortgage, you will eventually gain equity and benefit from the loss when you file your taxes even if you have to add in a few bucks monthly. Your rental will become an investment property.

I just did this last year with a client who did not want to hurt their credit. They lowered their price range on the second property, rented out the first to a wonderful tenant and could not be happier.

It can work. Just make sure the rental property is in great condition, and you will get a great tenant. Then YOU will own 2 properties, not the bank. I love Real Estate!

Call me.
Estelle Rattner
Prudential Fox and Roach Realtors
(856) 979-4892
0 votes Thank Flag Link Sat May 7, 2011
If you are not late on your payments you can sell as is and buy another home right now. But you must meet certain criteria.

Short refinance is really a forbearance and is only a good option if you want to stay in your home.

Do not walk away... You have gone this far in maintaining your credit. How do you know you are underwater?

Don't just short sale and be told you have to be late on your payments before you can short sale.

Larry Sarlo
RE/MAX Preferred
0 votes Thank Flag Link Fri May 6, 2011
From my recent experience, the bank is going to require a hardship letter explaining why you want to walk away from your obligation. Without missing payments, it is almost impossible for the bank to pay attention.
And, if you do miss payments, there goes your credit. There are economic reports that 24 million homes are underwater in the US where people are still current on their payments.

- David Cooper..Las Vegas Foreclosure Investor in Bank Owned REOs with Cash Flow. email or call for FREE daily list. +1-7024997037 not a real estate agent
0 votes Thank Flag Link Fri May 6, 2011
Hi Maya,

I know what you are going through. I have 2 short sales listed right now. Prior to this they had great credit too. You're not alone. Call me and I'll be glad to go over the short sale process. There are many programs out there to limit your liability so let's talk privately. Jodi 215-275-7301
0 votes Thank Flag Link Fri May 6, 2011
The rentals in my area would not cover the mortgage. I am approved to purchase a new home-- is it possible to get a loan that will cover the shortage and then add that to the new loan?
0 votes Thank Flag Link Fri May 6, 2011

Have you considered renting your current home? You'd have to speak to a mortgage professional to see if you'd qualify for another mortgage while holding your current home as a rental.

Rentals are very active right now, you may be able to get more than your mortgage payment in rent every month.

If you want more info about rental rates in your area or need to speak with a mortgage professional about qualifying for a mortgage while renting your current home, please get in touch with me via email or my cell phone below.

Good Luck!

Barbara L. Smith
Weichert Realtors, Moorestown
SFR Short Sale & Foreclosure Specialist
cell/text: 609-980-7593
Web Reference:
0 votes Thank Flag Link Fri May 6, 2011
Thanks for your responses. I am only about $25,000 short on a $145,000 loan so the short refinance would not apply. Are there any other options?
0 votes Thank Flag Link Fri May 6, 2011
Hi Maya,
Thanks for your question.
I assume you are talking about your primary residence. Have you tried the NJ Mediation Program for people underwater like you said? The will work between you and the bank who hold your mortgage and negotiate in your behalf. It is free. 1-888-989-5277.
Good luck!
Ines De La Cruz
Web Reference:
0 votes Thank Flag Link Fri May 6, 2011
Depending on how underwater you are on your current residence there is a loan program called a short refinance. To be eligible for the program you have to be at least 25% underwater. There are a great many details that go with the program. Too many to mention in this e-mail but if you would like you can call me at 732-539-9300 for the details.

Camille Marotta
GMI Home Loans
Sr. Mortgage Originator 9838
0 votes Thank Flag Link Fri May 6, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer