June 16, 2011

Selling Your Home When You Are Upside Down

This can be very difficult thing to do when you owe more on your house than what it is currently worth. It can be even harder on you when you have to sell your home when you owe more than it’s worth. If you need to sell, the most important thing you can do is face reality. You must look over the data and find a REALTOR you can trust to help you understand your market. It is critical to not over price your house.

Some home owners think if they start a little higher then they can “meet in the middle”, but no one is going to meet in the middle if the house is not worth the middle. This inflated amount, whether its $5000, $10,000, or whatever is just rejection room and stopping a buyer from seriously considering your home. Even if somebody does want to buy the property for the inflated amount, when the appraisal is completed and the house doesn’t appraise high enough, they can’t buy the property anyway.

There are two outcomes here with one result.
  1. The house sits on the market for extra days and months until you get an offer, or
  2. You get an offer that cannot work due an inflated price and insufficient appraisal.
The only result of this is you have now just wasted time and money. The time you have wasted has allowed your property to become “stale on the market” and you have wasted money by making extra payments towards your mortgage, taxes, insurance, PMI, HOA dues, and maintenance.

Just think: The time you waste by inflating your price and making three extra payments towards mortgage, tax, insurance, PMI, HOA dues, and maintenance on typical $120,000 home, with a total payment of about $1000 because you tried to sell it for too much. Instead you could have lowered your price by at least $3000 and saved yourself of three months.

Chris Bauer
Real Estate Investment Advisor
Landmark Group

Cell: 402-510-1300
Fax: 402-916-4051

Go to http://www.chris-bauer.com/ for real estate tips and information.

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