Dealing with Financial Distress? Your House is Your Most Important Asset.

Young homeowners in financial distress.

It can be very difficult when going through a period of financial distress. We all have money worries at some point, but it can get especially challenging for some. Things happen in life that we can’t always in control. People lose jobs or struggle to keep up with inflated costs of living. Medical emergencies can be costly. It doesn’t take much to build up a lot of debt and find yourself in a tough position.

There is good news for homeowners who are dealing with financial distress. Your house is your greatest financial asset, and it could help you out of a bad situation if you make smart decisions. Now may be the best time to sell your house and relieve some—if not all—of your financial stress.

Do You Have Home Equity?

The first step is to figure out if you have any home equity built up in your property. This means your house is currently worth more than what you owe on your mortgage loan. Having any home equity can really make a difference in your overall financial situation. You may be able to tap into the equity with a home equity loan or cash-out refinance loan. Or, perhaps the better solution is to sell your property while you can. Ultimately, you can pay off your remaining mortgage and turn that equity into cash that you can use for other important expenses. You can find a cheaper living situation elsewhere and get out from under the burden of your mortgage debt. Selling now is smart if you are falling behind on mortgage payments and worried about foreclosure. Sell your house while you still can and take advantage of your equity.

Are You Upside-Down?

The other situation can occur where you are upside-down on your mortgage loan. This means the house is worth less than you still owe on your mortgage. There is no home equity. At best, maybe you are able to break even by selling. If that’s the case, you should sell as soon as possible.

Otherwise, options do become more limited when you are upside-down. The important thing to remember is that you shouldn’t ignore the problem. Don’t dig yourself deeper into debt and stay in your home, hoping that things will get better. Talk with your mortgage lender about mortgage forgiveness and forbearance programs. Ask them if a short sale is a possibility. You may have the ability to sell your house and forgive your mortgage debt, even if the price is less than what you owe. Banks deal with many homeowners in financial distress. It’s best to explore your options sooner, rather than waiting for things to get worse later.

Home Selling Options

If you are dealing with financial distress and need to sell your house soon, you will want to consider several different solutions. A traditional sale with a Realtor® will definitely take longer to complete. You may not have the time to go through that process. Or, your house could be in poor condition and you don’t have the resources to make repairs before listing the property. You may want to consider a cash home sale. This is often a great solution for homeowners in financial distress. The sale can be completed very quickly. Most cash real estate investors are buying houses in as-is condition, so you generally won’t have to worry about any out-of-pocket repair costs. Investors tend to cover most—if not all—closing costs and other expenses in order to close the transaction quickly. The final selling price may not be quite as high, but you will save elsewhere and be able to get out of your home much faster.

If you are a homeowner who needs or wants to sell soon, contact PropertyLark. We can help you figure out which home selling solution is best. If a cash sale makes the most sense, we will make you a fair and fast cash offer and can close in as few as seven business days.