When Should You Consider Selling Your Santa Cruz Real Estate for Less Than You Owe
When the Santa Cruz real estate market slows, you may find yourself owing more on your home than it’s actually worth. If you plan to live in your home for a while, this isn’t a problem because the market will correct itself and you will get back your equity.
However, if you have to put your home on the market, you may find yourself paying at the closing table or negotiating for a short sale. A short sale means your lender agrees to accept an amount less than what you owe so you can sell your home. This solution is not perfect, and you need to carefully consider if selling your home for less than you owe is right for you.
1. Save your credit score. Your credit score is the most important item banks look at when deciding to give you a loan. The higher your score, the better chance you have of being approved for a loan and getting a decent interest rate. You need to do everything in your power to protect your credit score. A short sale will lower your credit score by close to 100 points, but a foreclosure will drop your score by 250-280 points.
2. You can’t make the payments. If you cannot make your payments because of a job loss or medical reasons, you may need to sell your home for whatever you can get. Your bank may approve a short sale if you can prove a hardship. Even if you have to pay for the difference between the sale price and what you owe, you won’t ruin your credit score by not paying your mortgage on time or risk foreclosure.
3. You’re moving. If you’re moving out of the area and don’t want to rent your home, you may want to cut your losses and sell your Santa Cruz real estate for less than you owe. The cost of maintaining two homes, in both money and time, is just too much for most people to handle. Unless your home seriously depreciated, you probably aren’t losing enough to make it worth paying another year’s worth of monthly payments.
Let me help you sell your Santa Cruz real estate fast and for top dollar. Call me today at 831.662.6522 or email me at lauren@laurenspencer.com
Links:
1. Credit Score
2. Short Sale
3. Moving Tips