Owe More Than Worth? Short Sale

What If I Owe More On My House Than The House Is Actually Worth?

Perhaps the scariest situation for any homeowner is to be behind on payments, trying to sell your house, and owing more than the house is worth,

Before we go into options, let me assure you that the very WORST option is to do NOTHING and let the bank take back the property via foreclosure.

A foreclosure on your record will absolutely destroy your credit score, affect other ancillary expenses (like insurance), will negatively impact your ability to get a nice apartment or rental in the future, and even affect your ability to get a job!

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My experience was wonderful. I was about to lose my house and Nancy came to my help and bought my property and saved my home.– Cheryl Brown House Seller

What Are My Options?

What can a homeowner who owes more than the house is worth, can’t afford to fix the property, and is behind on payment do to avoid bank lawsuits, tax problems, and credit damage?

The very best solutions for an upside down house is to turn it right side again.  The most obvious solutions is to catch up the payments, but most likely, if that were doable, it would have already been done.

So what are some other options?


Did I mention foreclosure may be the worst option?  Actually, bankruptcy is probably even worse!  Bankruptcy will only pause a foreclosure, not eliminate it.  Most mortgage agreements state that if the property goes into default, the bank will take back the property through foreclosure. Then, you will have both a bankruptcy and foreclosure on your credit history for the next 10 years! Plus, you may still be required to work out a repayment plan for the house.

Loan Modification

Loan modifications occur when the bank agrees to reduce principal, interest, and/or payments. Unless you have experience with the Loss Mitigation Dept. at banks, I would recommend working with a legitimate, experienced loan modification company who can prepare an effective argument for the banks because loan modifications do not have a high success rate.  For delinquent borrowers – – a loan modification resulted in an INCREASED payment amount more than half of the time!

Short Sale

A short sale occurs when a third party (like Clean Slate Homes) negotiates with the mortgage company to accept a discount on what is owned and release their interest in a property in exchange for a cash payment. This works well because Clean Slate Homes will agree to purchase the house, providing the bank with a signed Purchase Agreement (which significantly increases the likelihood of a bank accepting a discount).

Here, at Clean Slate Homes, we are happy to offer you a helping hand any time you need to sell your house. If you are behind on payments and owe more than the house is worth, most likely the short sale solution will be your best option.  We can help!  Contact us below and we can walk you through your options.

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