I have been asked by several clients, should I really try to keep the house???
Now, the answer to this question is …It depends! In light of our mortgage crisis it is extremely important to determine the true benefit in keeping your home. But with new loan modification programs that are in planning stages now, it may be possible to lower your mortgage payments.
For starters, please ask yourself, “Can I afford to keep this house?” Should my spouse leave today could I not only buy out their interest (which will increase the mortgage payment) but can I afford the taxes, insurance and also the household bills, gardener, water, trash, etc?
Also consider, “Why Do I Want to keep this house?” Are you tied to the house emotionally? Do you wish for your children to reside in a stable environment? Do you work close to home? Are your kids doing well in school and are the schools good?
The truth of the matter is, a lot of homeowners do not have much equity in their home. For many the loan amount exceeds the equity and depending on finances, you and your spouse may be behind with payments. If this is the case and you do not have many emotional ties to the home, you should consider other options.
In today’s market, you have options such as a “Short Sale” if something must be done expeditiously. ** I just hosted a New Pod cast with Martha Shanks regarding Property Options for Today…Please go to my Child Custody and Support site and click on “Podcast” for more information. If you don’t have to quickly settle the question regarding the house, and if you qualify (see other postings in this blog) you could get help with a loan modification.
Next, if there is equity in the home, please consider, “Can I really afford to ‘buy out’ my spouse’s interest?” Unless the parties decide otherwise, if you decide to keep the home, be prepared to “pay” for your spouse’s share of equity in the home. This will most likely increase your mortgage payments. Also, because of the “freeze” in our lending markets, you may face some difficulty in obtaining a loan.
Also, consider, “Can we continue to both own the property until the market gets better?” This will all depend on your relationship with your spouse and your goals. If there is some equity in the home, selling may be an option, however if this is not the case, it may be worth considering. This may mean the spouse remaining in the home will continue to pay the mortgage, while the “out spouse” finds someplace else to live. However with this option, you may be in a better position to sell your home at a later time. This also opens the door to a loan modification, as one of the requirements is a drop in family income.
Critical Illness Insurance Tea Forte
admin