Linda Strasberg

Is Your Family In Crisis?

Las Vegas

Certified Short Sale Specialist

While a bevy of new federal programs aim to help, underwater owners who want to move still face uncomfortable choices: Postpone the move and continue sinking money into a pit; sell for a loss, forfeiting the down payment and some savings to close the deal; desperately try to enter into a short sale; or simply walk away and face the consequences of foreclosure. If you (or your kids) are in this situation, here's how to think about the options.

Keep On Keeping On

If you don't have to move and can afford the payments, it probably makes sense to soldier on and wait for housing prices to recover.  Moody's Economy.com projects that prices in 61% of metro areas will return to recent peak levels by 2015.

If you live in one of the harder-hit cities -- which may take 20 years to rebound -- and you're more than 25% underwater, your house won't be a financial asset anytime soon. But as long as you're happy to stay in it for many years, that may not matter.

In the meantime, you may be able to cut your loan balance -- and lower your payments -- through a new federal program that refinances existing loans into smaller FHA loans. To qualify, you must be current on payments -- but it's up to the lender to agree to it. Some folks might be eligible for some of this aid.

Beg The Bank For A Break

What if you need to get out of the house?  Some folks initially consider renting their place out. But they'd probably lose money, given the spread between their mortgage payment and rental prices. Becoming a landlord is a risk even in areas where you can cover carrying costs, as you're still on the hook in between tenants.

It can take several months to arrange and negotiate a short sale. For best results, work with a "distressed-property specialist," a real estate agent who has experience negotiating with lenders.  For this type of specialist, select "SFR" under Find a Realtor that is short sale certified like Linda Strasberg. Short sales are expected to account for more than 50% of all real estate transactions by 2011!

A mortgage reported as "settled as agreed for less than amount owed" to credit bureaus can lower your score, but not as much as a foreclosure. When your mortgage is "settled as agreed for less than amount owed" your creditors/lenders may not seek or be granted a deficiency judgment on your primary residence in Nevada.

Speaking of foreclosure,a recent study by University of Arizona Law Professor Brent White says walking away may make sense financially if you're more than 40% underwater and could rent a similar house for less than your mortgage bill. But doing so has consequences, not the least of which may be a guilty conscience. Foreclosure stays on your credit report seven years -- and can cut a 780 score an average of 150 points, per Fair Isaac. That can affect everything from your insurance premiums to your employment potential to your future ability to buy a house.

Eat The Loss Yourself

For some, the best -- and fastest -- option may be simply selling the house and paying any difference between the sale price and the mortgage out of pocket. That is a good, if not particularly palatable, choice for homeowners who have significant savings and aren't deeply underwater. Selling this way eliminates any credit risks.

If you would like for me to get to know you better or if you just have questions about the short sale process, please schedule a complimentary telephone conference at 702-677-8796.

 Las Vegas Short Sale Specialist, Certified Short Sale Specialist, Las Vegas Realtor

Oh, by the way, if you have any friends or family who would benefit from our service, I would love to talk to them.  Just give me a call with their name and number and I would be happy to follow up and take excellent care of them.

Get Moving With Linda!

702-677-8796

Linda Strasberg, All Rights Reserved