Firstly you depending on the exact location of your condo you can rent the condo for $1500 - $1800 a month. It is also my personal opinion from the sales I have had as well as my investors that have purchased in Rogers Park that Rogers Park Park has stabilized and prices are finally starting to go up.
Moreover, groups likes the Rogers Park Builders Group are looking for ways to further improve the Howard Street Corridor and I feel confident things will be improving.
If you can hold on to your condo as an investment property it may pay off.
Best of luck.
If you're upside down by 100K- or something close- it could take a half decade or more of appreciation to even close close and more likely closer to 10 years. In that time you'll give away $80,000 in the hopes of breaking even.
Again, I can't say for sure what your best option is but I'd love to talk to you about it- it sounds like a short sale is something you should strongly consider.
If you are interested, email me back.
Best of luck.
The agent you hire will do a market analysis on your property and will consider your neighbors appraisal value. The neighbors appraisal could be factored in once it's determined who, why and when the appraisal was done. I've seen low appraisals that were not accurate for various reasons. Again, the who, why and when is an important piece of the market analysis.
1. Can you AFFORD to pay the $600-800 loss/deficit every month if you decide to rent it out?
2. If "yes", then..........how many months/years can you afford to pay it before it becomes a hardship?
(Why start out renting if you cannot continue do so until the housing prices catch up, since that is the purpose of renting it out in the first place - plan on this being longer than shorter term).
3. Do you have enough assets to pay for any major repairs that might become necessary over the period of the rental? Once you're a landlord, you need to factor that in. If you're in another state, who will oversee the property? (if you need to hire a property manager, that may be another cost). You said you love your "unit" - if that means it's a condo, you might want to make sure there aren't any restrictions to renting it out. You will also have to factor in periods of vacancy when you might have to pay the full amount of the mortgage, and not just the loss.
If you can't comfortably afford this added monthly expense and you will have sleepless nights with this hanging over your head........then you've answered the question (imo) as to whether renting is an option.
The financial "hole" you're currently in with be increased by the monthly loss you will be paying to cover the mortgage.
Look at the big picture.
In regard as to whether you "try to buy a new place"......NO........in my opinion, you don't want to add more debt until you figure out a way to pay off your current debt.
You said you are moving to a new state and a new job........do NOT tie yourself down to a purchase until you know this is working, you're settled into your new locations and job, and you've got a handle on your current financial issue.
Just my 2 cents............
Speaking to a real estate attorney and/or a CPA (once you know exactly what your home is worth) is another good suggestion........after 12/31/2013, .the IRS may not continue to forgive the debt should you short sale your home........get the facts first, and learn how this will impact you.
Last question..............do you have the assets on hand (ie: cash) to bite the bullet, sell the house at a loss, and pay off the mortgage?
This may not be appealing..............and leave a bad taste in your mouth, but.................
This would give you a clean start elsewhere even though your bank balance would be less.
I had a client who wasn't happy, but.........he came to closing with $40,000+ to pay off his mortgage just so he could walk away free and clear and maintain his excellent credit..... no need to look over his shoulder moving forward with his life.
Please meet with two or three real estate professionals and discuss your options. The reason I suggest more than one is that questions will come up and information will be shared to help you decide because each agent is different, their experience with lenders and how successful that agent may be.
Talk with your trusted tax advisor. They will review your situation and help you understand where you are financially. If you have sufficient funds to you may not have a hardship to qualify for a short sale. So understand what funds you have and the type of funds.
Meet with a Real Estate Attorney. Ask questions.
These meetings are fact finding meetings. Through these professionals, you will know what you can rent your property for, the cost to rent it out and your shortfall. The process for short sale and the risk and benefits to you. You will also learn any legal consenquences.
Once you have the information you should see which option make sense for your situation and ultimate goal.
All the best to you.
If you can carry the monthly rent shortfall without hurting your family, you will protect your credit, as a short-sale will have a negative impact on your credit. The renting short fall can eventually be recovered on your taxes since you can write off maintenance fees against the rent and the net passive income loss, but you should talk to a tax professional about your exact situation.
Renting with a shortfall will give you a chance to recover some of the lost equity and possible come out even in a few years.
First, please know that you're not alone when it comes to your scenario but fortunately you have options that can help you move on. I have quite a lot of experience helping homeowners navigate through the short sale process and it just so happens that the majority of my short sale experience has been in and around Rogers Park so I can assure you I have a lot of knowledge about the neighborhood and pricing - two things that are extremely important when it comes to selling your home.
As a Realtor my job is to work with you to price your home correctly and market your home to get the best offer and best Buyer to work with possible. At that point my job does not end however once you go under contract with a Buyer you will need to hire a short sale attorney who will then work directly with your bank(s) in order to obtain short sale approval. I have an amazing short sale attorney who I work with and can tell you I've had 100% success in my short sales with her. The only time I've had a short sale not happen was when an owner used their own attorney and a year later we used my go-to and we successfully closed. Throughout this time I'm always involved and I pride myself in keeping our Buyer and their team in the loop with updates. The biggest issue in short sales is keeping a Buyer due to the time it may take. The big reason why Buyers walk away is because the listing agent does not update and they're left in the dark. If there's no update, I still update!
On a final note my go-to short sale attorney can speak with you two about if they feel a short sale would be possible. In a short sale you need to prove hardship to the bank and my attorney will help to determine if she feels you'll have an easy or difficult time persuading the bank to grant short sale approval. Please contact me to both talk about selling your home, the marketing that I offer and I can also give you my attorneys contact information! I'm always available so just reach out!
3101 N. Greenview Avenue, Chicago, IL 60657
309-269-3499 CELL | 773-305-0480 FAX
If you would like to talk please call me at 312-738-0232.
No restrictions on rental from the board, but leary of becoming a landlord, especially from another state. A prop mgmt co. would only increase the loss we'd already take on a rental. We could absorb a loss for some time, but not forever. I know it's ultimately what we can afford, but was wondering where I can obtain a credit score for free?
Is there an average range for how much a short sale dings your credit score? How do you determine the length of time your credit takes a hit? Also, what are the proposed changes in 2014 to the short sale process that we need to be aware of, or where can we find more info about the proposed changes? And where can I find a projected market analysis?
Finally, while we have a tax advisor, do we need to find a broker, an agent or a Realtor? I don't know the difference. I assume once we narrow that down, we can get a referral to a real estate attorney from whomever we choose to work with.