As has been stated here you do have several options that you will have to consider. Depending on your financial circumstance, a short sale may not be a possiblity for you given you have indicated that you have savings and you are not indicating that you are having a financial hardship in making your current mortgage payments. If thisis the case, your lender may not be so willing to allow you to sell the home as a short sale without you at least making some form of contribution towards the shortfall that they may have.
It does appear that your wife is taking into consideration some of the pitfalls of becoming a landlord, the first of which is that the rental income would not cover the monthly expenses you have on the home, not to mention the distinct possiblity that should a tenant stop making the rental payments you would then be in a possible financial burden you dont want. Another thing to consider is that if you have to qualify for the new mortgage, the lender will not give you full credit for the rental income to offset the payments on the rental property. In other words you would need to be able so show that you have the ability to make the payments on both properties.
Depending on how far off you are from retiring that may just allow you to wait this market out a bit, and prices may come up just enough to cover the existing mortgage. Short sales , although now the norm is not always the right solution for all parties, there are lots of tax and credit considerations to keep in mind. As a realtor here in Miami I try to make sure that seller have considered , with the proper information what truly works best for them. Unfortunately, many people are using short sales as a way to get out of a house that they are currently in, due to value (strategic sale) to get a sort of fresh start, and dont realize that credit scores are affected, and the banks have really tightened up their lending standards.
Good luck in your decision making process, just make sure you have consulted with an accountant and even an attorney to ensure that everything is properly handled.
I want to address the value of the selling price; even if we could 5, 10 15 or 25K more the mortgage is still up there. We purchased in early 2007. From what I'm told somewhat at the height of the market.
So simply the question would still be a shortgae of approximately $75K + or a shortage of rent of $300 to $400 a month.
Kind of like picking the 'least' of two evils.
I do not know who your "expert" is or wish to rain on anyone's parade.
However it is a seller's market...depending on what other variables are in place for your home you may get 150K or more...I have not seen it, so I can't speculate.
As far as renting....people are being forced to rent due to either being foreclosed on or having to do a short sale on their property and simply cannot get financing to purchase again.
Rent may vary again, I don't know your home so I can't speculate....But, knowing the 32828 zip code it is a popular area. Covering your mortgage and HOA is better than hurting your credit by selling short sale. I'll be in that area on Sunday listing a home for sale. If you would like me to do a drive by and give you my opinion, please feel free to private email me.
Thanks and happy retiring!
I know my home is upside down because the real estate expert (realtor) in my community told me yesterday that I could not get much more than $150K tops over the next 90 days based on what I have which is an 8 year old home 3 bedroom just under 2000 square ft in the 32828 zip code.
My mortgage is $268K. My mortgage payments are aprroximately $1600. I am not late. She (realtor) told me i could rent it for 1200 to 1300 per month. HOA is minimum.
My wife thinks purchasing another home is preposterous and does not see the sense of being a landlord, especially if it does not cover the mortgage.
In regards to the damage that we will incur on a short sale, I can't see the hard ramifications of that being that we have no car payments, no credit card or installment loan debt, kids college has been paid etc.
You folks are the experts all with varied opinions. Who's right, who's wrong. What's right, what's wrong.
(written with tongue placed firmly in cheek... or perhaps I woke up on the cheeky side of the bed this morning?)
I am not a financial planner, but do plan to retire at some point, so have done some thinking about the situation I'd best prefer to be in. For me, reducing or eliminating housing expense is key, so, unless your move to the coast will include a downgrade in your monthly payments, I wouldn't consider purchasing another home.
There is so much 'gut reaction' to be weighed in your decision. Try looking at it like this:
Imagine that you currently own a big ole gas-guzzling Expedition, but your note is still substantially more than what you could sell it for. You'd really like to down-size the vehicle to something like the new Buick that Shaq is advertising (clearly, I'm not a car girl) that is still comfortable and luxurious, a bit smaller and way better on gas. In order to do this, the dealer will happily roll the balance of your old vehicle into the note for the new vehicle. So you get your nice new car, save at the gas pump, but are still, essentially, paying for the vehicle you no longer have.
What would you do?
Century 21 Professional Group, Inc
consideration, and the pros and cons examined carefully. Unfortunately there is currently not enough information to make an informed decision. For example, being upside down $100K on
a $1M home is quite different from being upside down $100K on a $200K home. Location, condition, type of home and community are also important factors, among others. With the right information I could possibly help you make the right decision. Feel free to call me for a consultation at 407-864-3139, or send a quick email to: email@example.com
Orlando, Fl 32819
You'll get alot of great answers from alot of great agents!
Congrats on your retirement!
Knowing that you have worked hard all of your life and now just want to enjoy! I think that's fantastic.
As far as your particular circumstance....there are many factors!
If you feel comfortable renting your Orlando home, and with the increasing rental market it most likely will not be hard to find suitable tenants. You can make enough to cover mortgage and utilities and have some left over, great!!!!
Knowing where you are financially and the market do play huge factors in your decision.
If you have a financial planner that can direct you, that would be a good start.
If you need help from one of us to sell, rent or help with your new home....I'd be happy to help.
Charles Rutenberg Realty
I would recomend a new home, just call me!!!!
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