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6 Great Tips for Underwater Homeowners (How to Keep Your Head and Home Above Water)

Jan 19, 2012

In today’s economy -so many homeowners are underwater on their mortgages. Here is an excerpt from Inman News with a few tips that can save you some of the worry and a few ideas of ways to make or keep extra cash you can use to stay on top of your mortgage.

Here are six alternatives to walking away, some more obvious, some less, but all underutilized, from my vantage point.

1. Get rid of your credit card debt. Again, this might seem obvious, but I’ve encountered a number of people who say they can’t afford their mortgage payments who actually could afford them if they dealt with their credit card and other debt.

Call your creditors and make an effort to settle your debt; many will take a lump sum payment much lower than your balance. While this might have tax and credit score implications, it might also help you keep your house. Or work through steps No. 2 and No. 3, below, to just eliminate those balances, by any means necessary.

2. Get a second job. This seems obvious, too, but I believe it’s simply not done nearly as often as it should be, mostly out of pride and emotional defeatism.

You already work 40 hours a week. You’re already tired. But you know what? I know MBAs who got into a bad debt situation and are climbing their way out with high-end, table-waiting tips. It won’t last forever and, again, could be very much worth it.

If you’re not up for this sort of hustle, and you’re a white-collar professional, there are tons of consulting or contract gigs out there to be had, which can help you catch up on missed mortgage payments or bring down your debt.

3. Start a side business. Sites like Etsy, TaskRabbit and elance allow people to monetize their spare time, quirky hobbies and special skills. I know a journalist who nearly matches her day-job income dog-sitting while she writes.

4. Rent a room — or two — out. Put your man cave on Trulia or Craigslist for rent. If you can’t stomach the idea of a permanent roommate, check out Airbnb and see if you can generate some extra cash renting out your rooms to those visiting for short periods of time.

5. Apply for everything. Decide right now to simply refuse to be deterred by the first roadblock that comes up in your pursuit of a loan modification — and there might be many. Commit, instead, to applying for everything for which you might possibly qualify, and don’t make assumptions about what programs might work for you (many loan mod programs have loosened their guidelines or gotten more efficient over time).

Apply through your lender to the federal HARP program, and also to the lender’s own loan mod program. Visit this federal site to determine whether there are additional state programs available to you under Treasury’s Hardest Hit Fund. Apply to the wildly successful (as these things go) Home Save program run by NACA.

It ain’t over till it’s over.

6. Short-sell it. Banks are now taking a couple of years, on average, after the first missed payment to foreclose on and repossess a home. If you list your home for sale with a local agent who has experience closing these transactions right this moment, your chances of selling it and having the short sale complete in time to qualify for the income tax exemption that expires Dec. 31, 2012, are actually better than your chances of qualifying for the exemption if you stop making your mortgage payments right now.

Again, it’s ubercritical that you work with professionals, from the folks at NACA to a local agent and attorney and certified public accountant (CPA) if you’re seeking a loan mod or a short sale. Beyond advising you about implications to be wary of, the pros can help educate you about the full scope of options available to you.

Your best bet is to run even getting a second job past your trusted advisers before you do it, as it might impact your prospects of getting relief from your lender.

Full the full Article here.

*Should you have any questions or want additional information on short-sales and the short-sale process email Brittany at BrittanySellsLA@gmail.com.*

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Brittany Sells LA

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Wow! 10 years! When I first embarked on this journey I had NO idea I would fall so hard for this career. I couldn’t fathom the places it would take me, the amazingly wonderful people I would meet ♥️ and the opportunities it has afforded me. I never imagined this career would be so rewarding or fulfilling. It’s what keeps me going. What makes me feel alive. My one, true love. Most Realtors change offices many, many times over. I have remained true and loyal to the company which gives back so much. Keller Williams Los Feliz is my family. It’s the place I have made some of my first and best friends. Where I sold my first house where so many memories have been made. I wouldn’t be where I am without the support of this office and the people I’ve met along this incredible journey. I am eternally grateful. I have to send a huge shout out to my amazingly wonderful mom. She never stopped believing in me and encouraging my dreams. Thank you to Gary Reavis for being such an inspiration and ally in my life and career. You helped make this super fun and contributed to so many of my wins! To my amazing mentor when I was a weeee young clueless Realtor, Kenya Reeves-Costa (and for giving me the BrittanySellsLA branding idea). To our new team leader, Brock Worthen for continuing to inspire, cheer, and root for all your agent’s successes. I know I didn’t win an Oscar or a Grammy here, but making it 10 years in a cut throat industry is an accomplishment worthy of thanks and honorable mentions. I didn’t get here on my own. So here’s to the next 10 years. To the highs. To the lows. To the lives I am blessed to change and to all the remarkable people I have yet to meet. Perhaps the biggest thank you of all goes to each and every one of my sweet clients who trusted me over the past 10 years to find them their American Dream! It was a huge honor. Love you all and thank you for your continued referrals. I wouldn’t be here without YOU! Sincerely, Brittany Walter

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