Our family has out grown our current place and we would like to move to a bigger place. Our mortgage is

Asked by Tammy, Stanton, CA Thu Jun 19, 2008

$410,000 and now it's worth $310,000. Is there a way for us to sell our property and the differences in the balance, have that transfered to our new loan?

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Don Tepper, Agent, Burke, VA
Thu Jun 19, 2008
Not that I'm aware of. There are blanket loans, sometimes used in construction and for commercial property, where one mortgage or loan covers multiple properties. But I doubt you'd be able to do that here. After all, if you're $100,000 upside down on your mortgage, the lender would want some security applying to both of the properties. And I doubt that you've got enough cash to be able to do that.

Plus: Are you really sure that what you're proposing is a good idea? I'm not. Consider: If you were able to do that, suppose you found a new home with a value and a list price of $400,000. You buy it for $400,000, and have your $100,000 in negative equity transferred to the new property. Now you've received nothing for the sale of your old house, and you've spent $500,000 ($400,000 purchase price plus $100,000 in negative equity) on the new house. I doubt a lender would go along with that! And even if a lender did, you'd be $100,000 in the hole, in what, in many parts of the country, is still a declining market. Let's assume prices decline 10% more over the next two years, then are flat for two years. That's not an unreasonable prediction. That means that in four years, your new place would be worth $360,000. Meanwhile, you'd have a mortgage of up to $500,000. You'd only be digging yourself further in the hole. Then, let's say you want to sell after four years. Allowing for a real estate commission and other costs, you'd be adding perhaps another $30,000 in debt. So now we're up to $170,000 upside down on a property worth $360,000.

Check with a good Realtor and get a CMA on your property. Make sure it's worth only $310,000, or so. But you're probably in the general ballpark.

Based on what little you've provided above, I'd strongly recommend that you consider staying where you are. I'm sure you'd like to move to a bigger place. But if you're $100,000 upside down, "liking to move" isn't enough of a reason to do so.

Hope that helps.
3 votes
Joe Homs, Agent, Laguna Hills, CA
Thu Jun 19, 2008

Sorry to say, but that is NOT possible. Your loan is tied to your current residence and is not transferrable to a new home. Your looking at possibly negociating a loan modification, with your current lender, and stay where you are at, or a short sale.

Without knowing all your details it would be difficult to provide you with good advise. Please give me a call or send me an email and I can advise your further.

Joe Homs
Realty Partners
Web Reference:  http://www.joehoms.com
2 votes
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Mon Nov 24, 2008
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0 votes
George, , Costa Mesa, CA
Mon Sep 15, 2008
You, like most people who purchased in the last few years, are upside down.. you can either a. come up with the difference when you sell or b. attempt a short sale.. Short sale just means you're trying to sell for less than what you owe and hoping the bank will let you.. typically, to approve a short sale, there needs to be some sort of hardship.. you're asking the bank to give up $100k and if you don't have a very good documentable reason, they won't approve you. Good reasons include divorce, death, loss of job, loss of limb, etc.. By doing a short sale, you are definitely going to affect your chances of getting a new loan.. Most mortgage companies/banks if not ALL consider a short sale a foreclosure. Doesn't matter if you don't have any late payments or have perfect credit otherwise.. So if you attempt a short sale, expect to have a very hard time finding financing for your new home. Most loans are going through Fannie Mae/Freddie Mac and FHA.. FHA requires min. 3 years and last I checked, Fannie Mae/Freddie Mac required min. 4 years since foreclosure/short sale/deed in lieu. FHA can SOMETIMES let you buy before 3 years are up but only if you have a VERY VERY GOOD reason for the short sale. Inability to sell or being upside down don't qualify. Good luck.

My personal advice.. Short sell and rent for a few years while saving as much money as possible.. Buy in 3 years when you qualify. Or sit in the house until it's not upside down anymore.. but expect that to take 10-15 years per some recent online forecasts.
0 votes
Nathan Kramer, , Orange County, CA
Fri Sep 12, 2008
Sorry to tell you but with your situation, which is not unusual in today's market, you are in the situation where you will to do what is called a short sale. You will need to speak with those lenders who you have outstanding debt on the home and convince them why they should agree to release you from your lien to them for less than you agreed to. To do this effectively you need a real estate agent to do this. Also, you will need an offer to bring to the bank so that they can determine the price that they would agree to if they agree to the short sale.

There is no way to carry the balance of the loan to the next place... i am sorry... think of it this way... if you were a lender would you take an extra $100,000 of debt from a previous person and make it even more difficult for the buyer to pay back the new loan that you just lent to them? probably not... it doesn't make sense for a lender to do so....

For more answers there is a site that I found that really helps tell you about selling your home.... It's specifically for Costa Mesa but its information is helpful...
0 votes
Jonathan Tay…, , Orange County, CA
Thu Sep 11, 2008
no, you have a short sale
0 votes
Mo Shahlaee, Agent, Arlington, TX
Tue Jul 1, 2008
l sell your house that your in it now, while we have it in market & we will look for the house you are looking to buy. I will get you into the house you are buying and move out of the one you are selling. call me 817-703-5300 or visit me at www. texashome4me.com
Web Reference:  http://www.texashome4me.com
0 votes
Jacqueline W…, Agent, Irvine, CA
Sun Jun 29, 2008
Another option may be to consider leasing your current home.....depending upon what your monthly PITIA is compared to the market rents in your area. You would also need to consider whether or not your current income/credit scores/available funds would allow you to rent out one home while buying another. I recommend you speak with someone who can run the numbers for you and provide you with options. Let me know if you need a resource.
0 votes
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