When is it Time to Walk Away If Your Mortgage is Underwater?
For many homeowners finding themselves underwater on their mortgage, it could be a surprise to them to learn just how big of a segment of the homeowner population are in the same boat. It is an embarrassing situation, and for this reason, some homeowners put their head in the sand, simply ignoring the problem. By doing this, they sometimes stop communicating with family, friends, and importantly, they stop communicating with the lender or other professionals such as attorneys who could possibly help them.
But even those many face similar situations, the time can come when a homeowner just does not have the financial means to continue payments. Recent estimates in real estate approximated over 10 million homeowners currently own homes with mortgages that are greater than the value of their homes but who still pay their monthly mortgage premiums. This means huge amounts of homeowners are unfortunately facing the same position you might be facing. Continuing to shell out large monthly payments each and every month on a house with a lower value is possibly the definition of insanity.
If you are in a position of not being able to afford monthly payments, you could keep the home or you could let it go through strategic default. Often this option is preceded by an attempt to move forward with a short sale or deed in lieu. If that does not work, ultimately you can let the home go through a Ch. 7 strategic mortgage default bankruptcy. Richard Weaver is a bankruptcy attorney in Dallas helping clients "get out from under" underwater mortgages. He can provide you with legal options through bankruptcy which would protect you and allow you time to get finances in order for you to be able to afford the move and afford getting into a new living situation.
This removes any potential for financial responsibility relating to the home or the mortgage in the future. It also scrapes all of your debt that is qualifying and which is unsecured off of your credit. This has the effect of taking a samurai sword to your credit. Although it could not be realistically said that a bankruptcy repairs credit, it certainly could be said that it clears your credit of dischargeable debt and allows you a fresh start. In many cases the credit is already poor, so a bankruptcy even has the effect of raising a person's score by as much as 80 points immediately when it is filed.
Comments(0)