| 15 December |
I have a major financial dilema. I own a condo in Michigan where the economy and the housing market has pretty much hit rock bottom. I moved out of the condo a year and a half ago because I lost my job and moved home to be closer to my new job. I had the condo on the market from July 2005 until August 2006 with no offers. I decided to rent the place out in August and had someone sign a one year lease. Now she is moving out because she bought a house and cutting out on the lease 6 months early. I wanted to put the condo on the market again now. But a realtor told me that I cannot sell it for more than $138,000 but I owe $152,000. So basicaly I won’t even break even and I have no money saved to pay the difference. I need to get rid of the condo but it is killing me financially. any ideas of what i can do? I need to sell because I won’t be able to buy a house with my boyfriend in the future if I still own the condo.
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10 comments to 'I can’t sell my condo and I need to do something fast?'
December 16, 2009
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Walk away. I know it sounds brutal, but it happens. I bought a house for 95,000, and 3 years later it was worth only 60,000. We dumped it and moved. The funny thing was it NEVER affected my credit or made buying another house difficult.
December 16, 2009
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You need to rent it again. Hold on to it if you can until the value gets up to $165,000 when you should be able to sell it.
Do not do a “Short Sale”! That is when you sell the property for whatever you can and ask the lender to agree to take less than a full payoff. They often agree, but it impacts your credit almost as much as a foreclosure does. It will keep you from buying with your boyfriend (also not a good idea, but thats a different issue).
Get a decent and honest property manager and bite the bullet. Lots of people in this situation now – you just have to be decisive and PLAN to do what it takes to come out on top.
December 16, 2009
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Wait. Rent it to some international students or international family, they are nice and if you rent it in a good price, they will stay there as long as u want. After the housing market jump up again. Sell it again.
December 17, 2009
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I would rent it out and wait for the market to come back around.
Do not listen to Alan, he is giving bad advise
December 19, 2009
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Find another renter and hold it as long as you can, assuming you can get rent payments above or at least near your monthly payments on the place. Or see if some bank would give you an unsecured loan to cover the difference if you sell it, which would suck since you’d have to pay that off over the next few years. Better to see if you can keep up on it with a renter and sell in a few years, hopefully at least breaking even at that time.
December 23, 2009
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DO NOT WALK AWAY. It will destroy your credit. Why can’t you rent it out again?
I am taking you literally when you say that the market has hit rock bottom. Will the market commence digging or is there a recovery in sight? If it has truly bottomed out, then there is no where to go but up. Try and hold out for better days.
The plan of buying another house in the near future should be your motivation to make something positive out of this (rent it again). Foreclosure will prevent you from achieving that goal.
Get a second opinion from another Realtor. CMA’s vary from one person to the next. Ask for justification of the CMA. Also, ask them how they plan on marketing your property.
Best of luck.
December 23, 2009
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Keep the place as a rental if possible. If you keep it occupied and the rent collected at least covers the payments, you will accumulate equity. You will also be able to borrow against the equity of the condo in the future.
You can also have a clause written into future lease agreements that has an early termination penalty (two months rent) for people breaking the lease.
You can still buy a home in the future and still own the condo. You would need to list the condo as an investment. As long as it is generating money, banks will still loan you money for other property. You can also incorporate (investment company for example) and list the condo as a company asset. There are ways around not being able to buy a second property.
I own two places…..one is mine and the other I sold a 50% interest to a friend to lower my monthly payment enough to satisfy a bank ready to carry the loan on my new place. The main worry of a bank is if the property has a negative cash flow. If you can demonstrate a positive stable cash flow from the condo over an 18 month period, it will actually HELP you obtain a second loan in the future!!!
Do a little research on the web, you can make it work!
December 23, 2009
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I suggest to continue to lease it out, or look for business and other realtors that will buy it.
December 25, 2009
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It sounds like you need to rent it out, even if you can’t cover the whole payment with the income. It probably won’t sell–or it might take a long time to even if it does. So I’d get somebody in there paying rent ASAP. You can put it on the market too, if you want, and just rent it for 6 month leases.
Or you can move back into the condo yourself and get another job closer to it (or make a long commute if you can to your present job). This might be your best bet.
And you CAN buy a house with your boyfried if you have a tenant whose rent covers (or mostly covers) your mortgage on this condo.
December 28, 2009
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I would find another renter….hold on to it until the market goes back up…and it will go up..eventually….in the mean time….you need to go after the lady who bailed on your lease 6 months early for breach of contract. Basically, re-rent the house and sue her..get the other 6 months from her….and use it to maintain the property….see if you can find a decent property manager to look after the condo for you…..Develop a plan…and stick to it…..Also….as for buying another home in the future….if you keep very good financial documents….you will be able to use the rent from this propery as additional income which will not make your debt to income ratio out of line…and purchasing another additional house won’t be out of the question….(I did it)! Best of luck to ya!