Should we rent, sale or lease to purshase?

Asked by Learnasigo, Ardmore, OK Wed Nov 3, 2010

We almost lost our home into forclosure even after trying like crazy to deal with the company for months. After seeking the help of a FHA approved couselor she was able to help us get a loan modification. Now we owe more now than the house is worth after all their insane fees. We need to improve our credit score and was told that trying to sale the home right now would not be a good idea(credit wise). We moved out of the house and are thinking of doing a lease 2 purchase. Hoping that would help re-establish our credit and then make it easier to get a more decent asking price. There are alot of great people out there with bad credit for what ever reason that deserve to be treated like people and not just a number and could benefit greatly from this deal. This would be the first tenant experience for us and I am just trying to do all my homework before jumping in the deep end too quickly. Any Advice?

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8
Jennifer Bla…, Agent, Owasso, OK
Tue Jan 18, 2011
Hey Learnasigo:

Thanks for the update. I'm so glad to hear that you are staying persistent and optimistic! The market in OKC has picked up so, I hope that it haso has in Ardmore. I've read some promising articles on the state of Oklahoma's real estate market as well... if predictitions are correct, we should recover soon from the recession hit market. I'd love to hear from you when your home sells to hear how everything goes.

Good Luck to you!

Jennifer Henning
REALTOR | GREEN Certified
[p] 405.625.1576
[e] Jenn@JenniferSellsOklahoma.com
1 vote
Learnasigo, Home Seller, Ardmore, OK
Tue Jan 18, 2011
We now have our property listed with a realtor here in Ardmore Ok. -United Country Wilson Realty. It has been on the market for little over a month. We are keeping up with the payments and just biting our nails untill the place sells. A bit nervous because we are putting any extra money we have back into it to spruce it up since we are asking top dollar. Not sure if its the smartest move but I feel like it is necassary. We are not going to give up. It has made us smarter and closer...definately a learning experience. Thanks for all the advice...wish us luck! God Bless
0 votes
Jennifer Bla…, Agent, Owasso, OK
Sat Jan 15, 2011
I agree with Keith! How much money could you really save by moving out into another property anyways. Certainly, you would make a decison to move out of your home merely because the market value is lower than what you owe. If you stay values should rise, and could substantially... DON't lose everything you have worked for, keep strong!

Jerry Boston with JB Realty is a wonderful broker in Ardmore, I suggest you contact him.
1010 W Broadway
Ardmore, OK 73401
(580) 226-1812
0 votes
The Stephen…, Agent, Portland, OR
Thu Nov 4, 2010
Sell now, or plan on staying in your home until the housing market recovers (at least 3-5 years best guess).
0 votes
Keith Sorem, Agent, Glendale, CA
Thu Nov 4, 2010
Learnasigo,
You need to take a deep breath and relax.
Who is giving you advice about moving out of your home? Surely not the FHA counselor that was able to help you work out a mortgage modification?

Just based on your post, I would recommend:

1. You re-occupy your primary residence and live there. If you can make the monthly mortgage payments that the FHA counselor made possible, then do that.

2. One of the questions that you will need to answer is how it came to pass that at one point were qualified for a mortgage, now you needed a loan mod, and now you are having a tough time with that?

3. The fact that you qualified for a loan mod, and then the loan mod was unsuccessful (meaning that apparently you are unable to make even the reduced payment) is very common. Most loan mods fail because the owner is not making enough money to pay the reduced mortgage.

4. Your best move is to talk with a Realtor that has short sale experience. Have them review your situation. Chances are that you will be approved for a short sale, you can sell your home, and in two years be ready to qualify to purchase another. However, if you let the lender foreclose, you have to wait five years.

5. Do not confuse "improving your credit" with meeting the obligation of your current home. That means that making good on your financial commitment (the mortgage, which is a promise to pay) is in fact the single most important thing you can do to minimize the damage to your credit.

Good luck.
0 votes
jo, , Hollywood Hills, Los Angeles, CA
Wed Nov 3, 2010
All 3 make sence now a days...It depends on your income, future goals, your wants, needs, job stability, bank balance, etc. You need to think about EVERYTHING you have and come up with a viable solution for the present and future.
0 votes
Learnasigo, Home Seller, Ardmore, OK
Wed Nov 3, 2010
I dont think I fully understand the short sale process, how is it different than a foreclosure (credit wise) I have read thay it can be a long a drawn own process and that we are still penalized in the long run and we can not afford to pay the difference on the home if they accept a low offer. The house appraises for 160,000 and now we owe 158,000 due to fees. We bought it 5 years for 142,000. We have completely wiped out all our savings trying to save our home. We are not trying to come out rich or anything we just dont want to be upside down any longer.
0 votes
Kevin Olson,…, Agent, Colorado Springs, CO
Wed Nov 3, 2010
The problems you hit with the idea of renting and/or lease to purchase is that now you are relying on someone else in order to make the payment on a home you are underwater in. It's not impossible, but can create more and different kinds of stress than you already have. In trying to fix the situation, you can actually be creating more possible pitfalls in your future. It's great that you are trying to think of ways to get through this, but selling your home via short sale might be the best option to take even if it puts an immediate hit on your credit.

I would consult an attorney and financial advisor before you proceed, and keep doing the homework like you are now. It never hurts to be educated in these matters.

Good Luck,
Kevin
0 votes
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