Have you ever been in a relationship that you knew had no real future and yet it was so hard to break it off? You start out by having occasional doubts. Little by little those doubts become all consuming thoughts. You have trouble concentrating at work and may even lose some sleep thinking about. You know this absolutely will not work out long term, and yet can't imagine giving it up. Finally, you make the decision to break it off and tell the other person the truth. What once seemed impossible, now feels like a huge sigh of relief. It won't be easy, but your mind already starts wandering about what your new future holds. This is what many troubled homeowners feel when they finally make the decision to do a short sale; a huge weight has been lifted off their back. Although there are challenges and uncertainty that lie ahead, the homeowner can now stop stressing about what has passed and start making plans for a brighter future.
I have witnessed it several times when helping sellers with a short sale on their home. They usually start out overwhelmed. We start by putting all the cards on the table and looking at the reality of their particular situation. We then lay out all of the different options they can take. For many, attempting a short sale ends up being the best option they have. Then at some point, something clicks. You can hear it in their voice and see it their face. They have made the decision to move forward with the short sale. Immediately, the conversation turns from the "would haves" and "could haves" to planning for what will happen next. Doom and gloom seem to be replaced by hope with even a little bit of excitement. There is the obvious relief from taking a big step toward getting the proverbial "monkey off their back". There are also a variety of other qualify of life improvements to follow.
One example is a single mom who was paying over $3000 a month to pay for the mortgage on her 2 bedroom condo in Capitola. When her regular teacher pay was not enough, she worked the after school program as well as summer school. This left her all too little time to spend with her son and do many of the things they enjoy to do together. She loves to travel, and that was out of the question. She scratched and clawed to stay current on her mortgage and even applied for a loan modification (which was denied). Finally, when she started using her credit card to pay property taxes she knew that something had to change. This was not sustainable. We went over all of her options and then one day it all clicked. She made the decision to do a short sale and never looked back. She starting saving for a deposit on a rental and even planned a well deserved vacation. When it was all said and done, she moved from her two bedroom condo to a two bedroom apartment. My guess is that her housing cost dropped about $2000 per month. She is still in the same neighborhood, and even a little closer to the beach. Her son was able to stay in the same school and best of all they now have the time and resources to do a lot more fun stuff together. I would say her quality of life has improved. Yes, she did lose the down payment she had put on her condo. Yes, she will probably have a couple of missed payments in her credit report. In my opinion, these loses were greatly outweighed by the quality of life gained.