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Do not borrow against your 401k. That is a horrible idea. I would do the short sale route. As a last resort, rent it. I think your credit is the least of your worries at this point.
Walking away is always an option, too. Unfortunately with the housing market the way it is a lot of houses are worth 100k+ LESS than what the owners owe on them. Sometimes letting a house go into foreclosure is the ONLY option.
We really don't want to do that, we've taken that idea off the table for now. I'd hate to let the house go and ruin our credit, these next few months will be the most stressful we've ever experienced.
Then ask $199... and be prepared to go as low as your LENDER will accept.
You HAVE had that conversation with your lender... right?
Objective HAS TO BE to sell promptly so you can move on with your lives.
I have only had the conversation with the 2nd mortgage holder. I was thinking of asking $199k as well. And have the realtor put in the listing it's a relocation and sellers are motivated. Would that help?
We have found ourselfs in a similar situation, except we are almost 2 years down the line. My husband was offered an excellent opportunity in a different state 450 miles away in 8/12. At that point, we rented him a small apartment in the new town, while I stayed with our child in our home. A year later, 9/13, I was offered a great job in the same area as DH. So we rented a condo in the new town for our family and put the home for rent since it was underwater. The rent did not cover the full amount of our expenses (mortgage, 2nd mortgage, taxes, HOA), so each month we are coming under by about $300 dollars.
The house was purchased for $325K (250K first mortgage, 70K second mortgage) in 2006 ... homes similar to ours are currently going for $200K.
Our initial tenants have now moved. And we are once again scrambling to get the house rented. Again still at a loss of about $300-400 dollars a month. We are still renitng in the new state. In the meantime, we are considering taking out a loan on the 401K to pay for a couple of months of mortgage should the house sit without new tenants as we cant afford both the mortgage and our current rental condo.
I dont see the point of renting it out anymore or keeping the house (no financial or tax benefit). But my husband is afraid of the hit on our credit.
If you want to sell quickly, be the lowest priced home in the area. You mentioned other homes are listed at $220K and you owe $167K. Make your selling price be right where you pay off any realtor and closing fees and walk away with nothing.
If you can wait a few months, do as another poster said. Pay for an appraisal and sell it for 5 percent or a bit more less.
We have found ourselfs in a similar situation, except we are almost 2 years down the line. My husband was offered an excellent opportunity in a different state 450 miles away in 8/12. At that point, we rented him a small apartment in the new town, while I stayed with our child in our home. A year later, 9/13, I was offered a great job in the same area as DH. So we rented a condo in the new town for our family and put the home for rent since it was underwater. The rent did not cover the full amount of our expenses (mortgage, 2nd mortgage, taxes, HOA), so each month we are coming under by about $300 dollars.
The house was purchased for $325K (250K first mortgage, 70K second mortgage) in 2006 ... homes similar to ours are currently going for $200K.
Our initial tenants have now moved. And we are once again scrambling to get the house rented. Again still at a loss of about $300-400 dollars a month. We are still renitng in the new state. In the meantime, we are considering taking out a loan on the 401K to pay for a couple of months of mortgage should the house sit without new tenants as we cant afford both the mortgage and our current rental condo.
I dont see the point of renting it out anymore or keeping the house (no financial or tax benefit). But my husband is afraid of the hit on our credit.
So sorry about this. I know the frustration. We now have our home listed with a rental agency. No hits yet so that's been 2k out per month for the past 6 months (the 6 months before that we were able to expense it with my husband's company as part of the relocation)
Please keep me posted! Good luck
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