Home Selling in 94513>Question Details

Simon Fang, Home Seller in 94513

My house is under water, should I short sell it?

Asked by Simon Fang, 94513 Sat Aug 8, 2009

I live in Brentwood Calif.(94513). My mortagage is 300K, my house's appraisal value is 290K, but the realistic actual selling price is about 210K.

My question is "should I continue to put money in this deep hole or short sell the house, and live with the bad credit for some years?

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Answers

12
If you can afford the payment, your loan is a fixed-rate, principal-reducing loan with no big balloon payments or huge payment increases looming, and you don't have to move, my general advice to people is to stay in the home. If any of the above are not your situation, then you can consider a short sale.
0 votes Thank Flag Link Sat Apr 6, 2013
hi Simon, I would suggest to weigh out your options, If you can afford to hang on doit. Otherwise, jsut sell it and do a "short pay" I am an expert at short pays and have closed the transactions successfully, contact me for a free consultation. best of luck.
Henry vega
323-833-6466
henryvega@rodeore.com
0 votes Thank Flag Link Tue Dec 28, 2010
Simon,

Before considering a short sale, ask yourself why you have to sale. Do you have a hardship that prevents you from making the mortgage payments. If you do not have to move, I would suggest holding on to the property as the market will eventually come back. I would also suggest you consult with your tax accountant and your attorney before making a decision. If you decide to proceed with a short sale, contact an agent who is experience with both short sale and your market. An experienced agent is a must. Take care,

Cynthia Alfred, Realtor
Nunlkme@aol.com
Web Reference: http://www.AlfredTeam.com
0 votes Thank Flag Link Sun Aug 9, 2009
Simon,

You got some answers from fellow agents and few bad advices "not to pay mortgage". Now, you have to decide what do you want to do.

Before doing short sale, consult with CPA or tax attorney for tax ramification questions.

When you decide to short sale then work with an experienced short sale agent, not all realtors are good in short sale.
0 votes Thank Flag Link Sun Aug 9, 2009
In my opinion, 90k is not HUGE in real estate terms. Most people would pay $1000 a month for a BMW but balk at the $600 the difference on a 30 year mortgage. The BMW would be worth 30% of its value in 5-7 years when the payments are done but you might see a full recovery of your basis in the same time frame.

Stupid, stupid stupid.

I do understand that the interest on the 90k is meaningful but since you will be renting for a few years the negative is offset. It's also offset by the mortgage interest deduction.

So long as you can afford the home, I advise you stick around. Short sales are growing uglier and uglier and our companies attorney are starting to see the banks start to chase deficiency judgement against people where they can. If you are converned about the interest. make double mortgage payments if you can afford it. Check the math, it will amaze you.
Web Reference: http://bob2sell.com
0 votes Thank Flag Link Sat Aug 8, 2009
Hi Simon, IF you qualify, I can do your loan modification for free. I am a licensed Broker by the State of California. It is my way of giving back to the community that has given so much to me. I've seen too many people get scammed by loan mod specialists..sometimes their "office" has disappeared over night! You can check my credentials directly with the Department of Real Estate. You dont need a fancy attorney or even a broker like myself to do a loan mod, you can actually do it yourself but people choose to hire professionals as the time and paperwork involved is too cumbersome. Feel free to call or email me anytime. Good luck and please continue making your mortgage payments until you have a plan in mind as to what your next step is going to be. Good luck and God bless.

Kamal Randhawa
Broker
510-932-1066
0 votes Thank Flag Link Sat Aug 8, 2009
Simon
If your preference is to remain in the property, then try to negotiate a loan modification.

Question - if the property went UP in value by 20%, would you be trying to find a way to give that appreciate to the lender?

No, of course not. Markets go up, and they go down. IMHO if you like the house and do not need to move, either tough it out like most of us, or try for a loan mod. BTW, you'll need to demonstrate to the lender that you DESERVE an adjustment. Just because the value dropped alone is not sufficient reason for the lender to approve a loan mod.
0 votes Thank Flag Link Sat Aug 8, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
Contact
Steve,

I can understand why people might not want to pay their mortgage, and we should explain the upside and the down side to them, but there is incredible legal risk, financial risk, and other risk. This is both to the home owner and the agent providing them the information. Furthermore you are in Oklahoma. All Real Estate is local. I live in Brentwood. Now we are in an up market, the bank owned homes are in short supply and if you need to short sale it is a good time. But I do not know who his mortgage lender is and cannot give tell him how they might react. Also I have not looked at his home to do an evaluation. If this market bounces back he may only be a few years away from having equity.

Simon,

Generally speaking the short sale will not hurt you as bad as a foreclosure. As things stand now you could buy a new home in two years.
0 votes Thank Flag Link Sat Aug 8, 2009
No real estate agent should tell you not to not pay your mortgage. However, link the post below. It is not my article, but it is the best info I have read on deciding to pay the mortgage or not.

A lot of it depends on who the lender is. YOu also need a "Hardship" like loss of job, need to move, disability, etc. . . What a hardship is varies from lender to lender.

I have information at ShortYourHome.com
0 votes Thank Flag Link Sat Aug 8, 2009
Have you considered speaking with your lender about a loan modification?

Other points to ponder...
Real estate is a long term investment. If you can afford to make your payments, and you enjoying living in your home, tough it out and stay put.
If your home was worth $500,000 now, would you be selling?...likely not, because if you sold you would simply have to buy back into the same market so you wouldn't be making any "profit".
Good reasons for selling would be: "you lost your job and cannot afford your payments", or "you are moving out of the area."
Having good credit has value..it is worth protecting.

-Rich
0 votes Thank Flag Link Sat Aug 8, 2009
Simon,

One thing many sellers do not realize is you will not be approved for a short sale just because you don't want the house anymore or want to sell it just to get rid of the monthly payments.

You must demonstrate a financial hardship, such as loss of job, income, etc. Also, if you do have money available, the lender will less likely not approve a short sale. So, you basically need a dire financial hardship and are doing the short sale to avoid a foreclosure.

If that is your situation (financial hardship and trying to avoid a foreclosure), you can consider a short sale. If that is not your situation, and you don't need to sell, you can just keep your house, keep maying the payments, and not damage your credit.

Remember the value of your home only matters when you go to sell it.


Craig Lawler
Security Pacific Real Estate Services
Craig@RealEstateCraig.com
0 votes Thank Flag Link Sat Aug 8, 2009
Being under water does not demand selling. Your answer to several questions should help with that decision.
Can you continue to make the mortgage payments? (If no, sell. If yes, go to next question)
Would you like to live in the house for the next five or so years? (If no, sell. If yes, go to next question)
Could you manage the damage a short sale (or foreclosure) would do to your credit? (If no, don't sell)
Finally, if you can not continue to make the mortgage payments, it is possible that a loan modification would give you that ability. if that's something you want to try, beware of scams. Do not pay anyone any money up front. I can refer you to a licensed real estate broker with 30+ years experience on Contra Costa County, who will not only go to work with no up front money, he will not charge anything unless the loan modification is successful.
0 votes Thank Flag Link Sat Aug 8, 2009
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