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Home › Forums › Financial Markets/Economics › New: When does it make financial sense to dump my house?

  • This topic has 220 replies, 16 voices, and was last updated 15 years ago by patb.
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  • November 20, 2009 at 11:17 AM #16694
    SellingMyHome
    Participant

    All,

    I have read many posts here, and admit that I still have a lot to learn. Thanks for the many answers to questions folks post here.

    23109VC started a post earlier asking about his situation. I appreciate the honest answers. But, his situation is different than mine, so I’d like to feel you out. By the way, I am the one that responded to the Battiata bashing post. I have listed with him already, and have an offer already, and they have submitted the package to the bank. I’ve yet to see how they deal with other buyer’s agents, I’ll still let you know how my experience goes…

    My story:

    Bought a house in Lakeside (92040 zip) in 2003 for a little over $400,000. Since then in 2006 or so, I did a refi with about $15,000 cash out (all of which went in to fixing up the house, not for new BMW’s). So, that means we have a recourse loan. Actually got out of an 80/20 in 2005, then refi’d in 2006. Closing costs were always rolled in, so total owed got higher! Can you believe the banks do that? My house actually appraised for over $600K during my last refi!

    We currently owe about $450K, can get about $350K after realtor fees. That means we are hoping for a $100K forgiveness.

    Current mortgage and Property tax add up to $3,300/month. Total household income is about $120K, and I estimate we save about $900 month with the interest deductions, so would need to rent for less than $2,300 to make it work. We could easily find a place for less than that that suites our needs.

    Why do we want out? Like 23109VC, we need a bigger place, and hate to see houses going so cheaply. We could easily buy a bigger and newer house for the same as we owe, or a little more. Also, a neighbor recently converted their house into a nursing home. This has upset my wife a lot! We’re not sure if it will just be the infirm elderly, or worse, halfway house type folks.

    Can we afford what we have? Yes, but with two kids under four, we have saved absolutley nothing in the last four years, and have actually been dipping further into our credit cards. I have a great pension at work, and wife contributes to her 401K. Sadly though, we have no savings in case of emergency.

    SO, my questions is: Is it financially smart to get out, rent, wait out the hit to the credit for the short sale, and buy in a few years? Should be able to save enough for a 10% down then. Also, will have more money each month with higher income, school loan paid off, and one less car payment.

    This is purely a financial question. What are the potential downsides to my particular situation? Will our current lender even accept a short sale? Will they want me to pay something back?

    Feel free to ask clarifying questions.

    THANKS! Brian

    November 20, 2009 at 11:28 AM #484649
    SD Realtor
    Participant

    I think you are doing the right thing. To move forward, my opinion would be to rent for awhile, work on rebuilding your credit, and save as much cash as possible. Live within your means.

    Unfortunately you are listing with an agent who has about a 40% success rate. This is not my speculation, this is simply what the numbers show when you add up his solds verses his cancelleds, expireds and withdrawns for the past year.

    It is your job to be proactive. You should be contacting him at least once a week to check the status. You should get involved with the transaction, find out who the negotiator is, check and see if your listing agent is doing everything and delivering all the documentation the negotiator requires. Normally I would not advise a seller to get involved like this. If you had a listing agent with a better track record for completed sales then I would not be worried.

    The questions you posed about whether the lender will accept your offer is something that you should be calling the lender to check on. The lender will analyze the numbers and the paperwork you provided and check out what the BPO and appraisal come in at. Chances are they will accept the sale especially if you show them INCREASING credit card debt. Homeowners CAN increase probability of acceptance by SHOWING the short sale lender financial problems. You need to convince them or at least your realtor needs to. I would be proactive if I were you.

    Also pose as a buyers agent and call Battiatas office to find out how easy it is for perspective buyers agents to get information about your home.

    As for how easy will it be for you to buy a home in the future? That is speculative but you are not alone. Cleaning up your credit will be priority one but I believe if you clean it up, stay clean, start building up a cash pile you will be okay in a few years.

    November 20, 2009 at 11:28 AM #484818
    SD Realtor
    Participant

    I think you are doing the right thing. To move forward, my opinion would be to rent for awhile, work on rebuilding your credit, and save as much cash as possible. Live within your means.

    Unfortunately you are listing with an agent who has about a 40% success rate. This is not my speculation, this is simply what the numbers show when you add up his solds verses his cancelleds, expireds and withdrawns for the past year.

    It is your job to be proactive. You should be contacting him at least once a week to check the status. You should get involved with the transaction, find out who the negotiator is, check and see if your listing agent is doing everything and delivering all the documentation the negotiator requires. Normally I would not advise a seller to get involved like this. If you had a listing agent with a better track record for completed sales then I would not be worried.

    The questions you posed about whether the lender will accept your offer is something that you should be calling the lender to check on. The lender will analyze the numbers and the paperwork you provided and check out what the BPO and appraisal come in at. Chances are they will accept the sale especially if you show them INCREASING credit card debt. Homeowners CAN increase probability of acceptance by SHOWING the short sale lender financial problems. You need to convince them or at least your realtor needs to. I would be proactive if I were you.

    Also pose as a buyers agent and call Battiatas office to find out how easy it is for perspective buyers agents to get information about your home.

    As for how easy will it be for you to buy a home in the future? That is speculative but you are not alone. Cleaning up your credit will be priority one but I believe if you clean it up, stay clean, start building up a cash pile you will be okay in a few years.

    November 20, 2009 at 11:28 AM #485188
    SD Realtor
    Participant

    I think you are doing the right thing. To move forward, my opinion would be to rent for awhile, work on rebuilding your credit, and save as much cash as possible. Live within your means.

    Unfortunately you are listing with an agent who has about a 40% success rate. This is not my speculation, this is simply what the numbers show when you add up his solds verses his cancelleds, expireds and withdrawns for the past year.

    It is your job to be proactive. You should be contacting him at least once a week to check the status. You should get involved with the transaction, find out who the negotiator is, check and see if your listing agent is doing everything and delivering all the documentation the negotiator requires. Normally I would not advise a seller to get involved like this. If you had a listing agent with a better track record for completed sales then I would not be worried.

    The questions you posed about whether the lender will accept your offer is something that you should be calling the lender to check on. The lender will analyze the numbers and the paperwork you provided and check out what the BPO and appraisal come in at. Chances are they will accept the sale especially if you show them INCREASING credit card debt. Homeowners CAN increase probability of acceptance by SHOWING the short sale lender financial problems. You need to convince them or at least your realtor needs to. I would be proactive if I were you.

    Also pose as a buyers agent and call Battiatas office to find out how easy it is for perspective buyers agents to get information about your home.

    As for how easy will it be for you to buy a home in the future? That is speculative but you are not alone. Cleaning up your credit will be priority one but I believe if you clean it up, stay clean, start building up a cash pile you will be okay in a few years.

    November 20, 2009 at 11:28 AM #485274
    SD Realtor
    Participant

    I think you are doing the right thing. To move forward, my opinion would be to rent for awhile, work on rebuilding your credit, and save as much cash as possible. Live within your means.

    Unfortunately you are listing with an agent who has about a 40% success rate. This is not my speculation, this is simply what the numbers show when you add up his solds verses his cancelleds, expireds and withdrawns for the past year.

    It is your job to be proactive. You should be contacting him at least once a week to check the status. You should get involved with the transaction, find out who the negotiator is, check and see if your listing agent is doing everything and delivering all the documentation the negotiator requires. Normally I would not advise a seller to get involved like this. If you had a listing agent with a better track record for completed sales then I would not be worried.

    The questions you posed about whether the lender will accept your offer is something that you should be calling the lender to check on. The lender will analyze the numbers and the paperwork you provided and check out what the BPO and appraisal come in at. Chances are they will accept the sale especially if you show them INCREASING credit card debt. Homeowners CAN increase probability of acceptance by SHOWING the short sale lender financial problems. You need to convince them or at least your realtor needs to. I would be proactive if I were you.

    Also pose as a buyers agent and call Battiatas office to find out how easy it is for perspective buyers agents to get information about your home.

    As for how easy will it be for you to buy a home in the future? That is speculative but you are not alone. Cleaning up your credit will be priority one but I believe if you clean it up, stay clean, start building up a cash pile you will be okay in a few years.

    November 20, 2009 at 11:28 AM #485506
    SD Realtor
    Participant

    I think you are doing the right thing. To move forward, my opinion would be to rent for awhile, work on rebuilding your credit, and save as much cash as possible. Live within your means.

    Unfortunately you are listing with an agent who has about a 40% success rate. This is not my speculation, this is simply what the numbers show when you add up his solds verses his cancelleds, expireds and withdrawns for the past year.

    It is your job to be proactive. You should be contacting him at least once a week to check the status. You should get involved with the transaction, find out who the negotiator is, check and see if your listing agent is doing everything and delivering all the documentation the negotiator requires. Normally I would not advise a seller to get involved like this. If you had a listing agent with a better track record for completed sales then I would not be worried.

    The questions you posed about whether the lender will accept your offer is something that you should be calling the lender to check on. The lender will analyze the numbers and the paperwork you provided and check out what the BPO and appraisal come in at. Chances are they will accept the sale especially if you show them INCREASING credit card debt. Homeowners CAN increase probability of acceptance by SHOWING the short sale lender financial problems. You need to convince them or at least your realtor needs to. I would be proactive if I were you.

    Also pose as a buyers agent and call Battiatas office to find out how easy it is for perspective buyers agents to get information about your home.

    As for how easy will it be for you to buy a home in the future? That is speculative but you are not alone. Cleaning up your credit will be priority one but I believe if you clean it up, stay clean, start building up a cash pile you will be okay in a few years.

    November 20, 2009 at 11:33 AM #484654
    SellingMyHome
    Participant

    I will stay on top of my realtor, trust me, especially after what I’ve read.

    We just submitted the offer to the bank, so I imagine I should give it a few weeks before I call. Can I call lender (PNC by the way), directly?

    November 20, 2009 at 11:33 AM #484823
    SellingMyHome
    Participant

    I will stay on top of my realtor, trust me, especially after what I’ve read.

    We just submitted the offer to the bank, so I imagine I should give it a few weeks before I call. Can I call lender (PNC by the way), directly?

    November 20, 2009 at 11:33 AM #485193
    SellingMyHome
    Participant

    I will stay on top of my realtor, trust me, especially after what I’ve read.

    We just submitted the offer to the bank, so I imagine I should give it a few weeks before I call. Can I call lender (PNC by the way), directly?

    November 20, 2009 at 11:33 AM #485279
    SellingMyHome
    Participant

    I will stay on top of my realtor, trust me, especially after what I’ve read.

    We just submitted the offer to the bank, so I imagine I should give it a few weeks before I call. Can I call lender (PNC by the way), directly?

    November 20, 2009 at 11:33 AM #485511
    SellingMyHome
    Participant

    I will stay on top of my realtor, trust me, especially after what I’ve read.

    We just submitted the offer to the bank, so I imagine I should give it a few weeks before I call. Can I call lender (PNC by the way), directly?

    November 20, 2009 at 1:18 PM #484718
    SD Realtor
    Participant

    You can call the lender. Think of it like this. Anyone that the realtor talks to, you talk to. Also one thing that I did was every time I made a call to the lender I logged it, got the employees name and number and would send it to my clients. I did this more for my own protection then anything. There were times where I sent faxes into the lender 4 and 5 times before they somehow, “found” what I was trying to send them.

    Your realtor should have passed on to you a list of items that the short sale lender has demanded. I would hope that this entire package accompanied the offer that was sent in.

    As you are very early in the process, what you should be assigned a negotiator HOWEVER a negotiator probably will not be assigned until that package is complete. Now there is NOTHING from stopping you from calling your lender or servicing organization and checking on how things are going. Did they receive the ENTIRE package, when was the last time your realtor called them, has it been assigned a negotiator, if not when… etc…

    Empower yourself.

    November 20, 2009 at 1:18 PM #484886
    SD Realtor
    Participant

    You can call the lender. Think of it like this. Anyone that the realtor talks to, you talk to. Also one thing that I did was every time I made a call to the lender I logged it, got the employees name and number and would send it to my clients. I did this more for my own protection then anything. There were times where I sent faxes into the lender 4 and 5 times before they somehow, “found” what I was trying to send them.

    Your realtor should have passed on to you a list of items that the short sale lender has demanded. I would hope that this entire package accompanied the offer that was sent in.

    As you are very early in the process, what you should be assigned a negotiator HOWEVER a negotiator probably will not be assigned until that package is complete. Now there is NOTHING from stopping you from calling your lender or servicing organization and checking on how things are going. Did they receive the ENTIRE package, when was the last time your realtor called them, has it been assigned a negotiator, if not when… etc…

    Empower yourself.

    November 20, 2009 at 1:18 PM #485257
    SD Realtor
    Participant

    You can call the lender. Think of it like this. Anyone that the realtor talks to, you talk to. Also one thing that I did was every time I made a call to the lender I logged it, got the employees name and number and would send it to my clients. I did this more for my own protection then anything. There were times where I sent faxes into the lender 4 and 5 times before they somehow, “found” what I was trying to send them.

    Your realtor should have passed on to you a list of items that the short sale lender has demanded. I would hope that this entire package accompanied the offer that was sent in.

    As you are very early in the process, what you should be assigned a negotiator HOWEVER a negotiator probably will not be assigned until that package is complete. Now there is NOTHING from stopping you from calling your lender or servicing organization and checking on how things are going. Did they receive the ENTIRE package, when was the last time your realtor called them, has it been assigned a negotiator, if not when… etc…

    Empower yourself.

    November 20, 2009 at 1:18 PM #485343
    SD Realtor
    Participant

    You can call the lender. Think of it like this. Anyone that the realtor talks to, you talk to. Also one thing that I did was every time I made a call to the lender I logged it, got the employees name and number and would send it to my clients. I did this more for my own protection then anything. There were times where I sent faxes into the lender 4 and 5 times before they somehow, “found” what I was trying to send them.

    Your realtor should have passed on to you a list of items that the short sale lender has demanded. I would hope that this entire package accompanied the offer that was sent in.

    As you are very early in the process, what you should be assigned a negotiator HOWEVER a negotiator probably will not be assigned until that package is complete. Now there is NOTHING from stopping you from calling your lender or servicing organization and checking on how things are going. Did they receive the ENTIRE package, when was the last time your realtor called them, has it been assigned a negotiator, if not when… etc…

    Empower yourself.

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